Setting up Deductions for an Employee

For each employee who is included in Payroll, you can add deduction payroll items on the employee record.

You may need to create payroll deduction items before you can select them for employees. For information, see Payroll Items Setup.

To set up deductions for an employee:

Go to Lists > Employees > Employees.
Click Edit next to the Employee's name.
Click the Payroll subtab, then click the Deductions subtab.
In the Deductions field, choose one of the payroll items you set up for deductions.

For example, you may have set up a payroll item called 401(k).
In the Rate field, enter the deduction per pay period for this individual as a dollar amount or as a percentage.

For example, you might enter 60 for sixty dollars or 15% for fifteen percent.
In the Limit field, enter a limit, if one applies.

For example, you could enter 10,500 as the annual limit for the employee's 401(k) deductions.
Click Add.
Continue adding deduction items as necessary.
Click Save.

Setting up Negative Deductions for an Employee

To correct an incorrect deduction on a previous paycheck, use a negative deduction to add it back to an employee's earnings. A negative deduction automatically calculates the taxes. The negative deduction feature complies with all federal, state, and local taxable wage rules. This feature is supported as long as it does not result in a negative paycheck. If needed, you can enter a negative amount on the Create Payroll page, and review it before you commit the payroll batch.

Tip:

When adjusting a pre-tax deduction from a previous quarter, NetSuite recommends you make an adjustment instead of a negative deduction.

Negative deductions can be used for these pre-tax deductions:

Cafeteria Contribution – FSA: Adopt. Assist
Cafeteria Contribution – FSA: Dependent Care
Cafeteria Contribution – FSA: Health Care
Cafeteria Contribution – POP
Cafeteria Contribution – Medial Care Premiums
Commuter Check
401(K) Contribution
401(K) Catch-up
403(b) Contribution
403(b) Catch-up – After the Age Limit
403(b) Catch-up – With 15 Years of Service
Government Employee Deferred – 457(b)
Government EE 457(b) – Catch-Up Standard
SEP Contribution – 408(k)(6)
SEP 408(k)(6) – Catch-Up
Simple 408(p) Contribution
Simple 408(p) Catch-Up

Negative deductions should not be used for the Cafeteria Contribution – HSA pretax deduction.

To set up a negative deduction for an employee:

Go to Lists > Employees > Employees.
Click Edit next to the employee’s name.
Click the Payroll subtab, and then click the Deductions subtab.
In the Deductions field, choose from a list of payroll items that are set up for negative deduction.

Note:
If you allocate the negative deduction as a pretax deduction the system adds the amount to the taxable wage base. If you allocate it as an after-tax deduction the system treats it as an additional earning item with no tax implications.
In the Rate field, enter the negative deduction for the pay period as a dollar amount or as a percentage.
Enter the effective and expiration dates for the payroll item. These dates are checked against the payroll period ending date to determine which payroll items are affected.
Click Add.
Click Save.

When you create a payroll batch, the negative deduction is calculated as a reimbursement.

To set up deductions for an employee:

Setting up Negative Deductions for an Employee

To set up a negative deduction for an employee:

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