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After calculating gross wages for an employee is accomplished, much more difficult decisions have to be made. This course covers: What must an employer deduct from an employee’s wages? What can be deducted legally? And what can never be deducted? These questions and more must be answered correctly before processing that paycheck. And if this is the employee’s final check…the rules may change!

Of course everyone knows that payroll deducts for federal and state taxes. However, how much input does the employee have concerning these deductions? Which taxes are mandatory, which are a courtesy and which ones the employee controls will be explained in this course.   If the Internal Revenue Service (IRS) or the state wants payroll to collect for back taxes; how is that processed?  What does payroll do if a “payday loan” deduction is received as opposed to a creditor garnishment? Which ones must we honor and why? We discuss this during this course.  

Handling deductions is a complex task that payroll must get right every time for every payroll check. Failure to deduct the proper amount of taxes could result in penalties on the employer from the Internal Revenue Service (IRS), but making an illegal deduction for a fringe benefit or for collecting an overpayment can get the employer a visit from the federal Department of Labor auditor, the state Department of Labor auditor or both! 

This course discusses these topics and much more as we learn what you can and cannot deduct from an employee’s paycheck.

Learning Objectives

  • Explore which taxes are mandatory, which are a courtesy and which ones the employee controls
  • Recognize when federal and state wage and hour laws permit recouping overpayments to employees
  • Discover the limits that govern deducting for child support, tax levies and creditor garnishments as opposed to voluntary wage assignments
  • Identify the rules and regulations for deducting for cash shortages and breakages

 

Last updated/reviewed: November 26, 2019

32 Reviews (119 ratings)Reviews

5
Member's Profile
Upbeat and interesting speaker . It’s making me write more it’s making me write more it’s making me write more it’s making me write more it’s making me write more it’s making me write more it’s making me write more it’s making me write more
5
Member's Profile
This is a very good review of deducting from an employee's check. It reminded me of the importance to check state laws before withholding anything out of the ordinary from an employee.
5
Member's Profile
this course was very long but the speaker was not monotone and made the content somewhat entertaining. There are a lot of details about payroll deductions that will be helpful.
5
Anonymous Author
I liked that the instructor went into detail regarding what to do when receiving multiple garnishments and also highlighted deduction laws that are unique to certain states.
5
Member's Profile
Great class. It's been a while since I took anything about deductions from pay. I found it profoundly interesting when learning about the uniform part and overpayments.
5
Anonymous Author
This course provides an excellent overview of the circumstances that lead to employee over payments as well as important information regarding deducting repayments.
3
Anonymous Author
This course was overwhelming. I feel summary slides for key takeaways would have been useful. Great if you are in payroll. Otherwise just find summary elsewhere.
5
Member's Profile
Good material and covered the topics well. Great course especially for those new to the payroll profession or those that need a refresher on this subject matter.
5
Member's Profile
For those that process a good amount of garnishments and child support orders and others, this is a great course to take. Very detailed and informative class.
5
Member's Profile
This is an extremely thorough and detailed look at what you can deduct from an employee and under what circumstances, including federal and state limits.
5
Member's Profile
This information was very enlightening. Some of it was reinforcement for me and some I wasn't that familiar with. All in all, great course.
5
Anonymous Author
This is a helpful overview of garnishments, their priorities and other deductions. It would be helpful to anyone who does payroll.
5
Member's Profile
Instructor was extremely knowledgeable and very effective in her presentation. She was interesting and didn't waste any time.
5
Anonymous Author
This class offered a lot of valuable information regarding deductions. Good examples were given to reinforce learning.
5
Anonymous Author
This instructor is my favorite. She's so thorough and uses real life examples to put the lessons in perspective.
5
Member's Profile
Very informative and worthwhile to take. This is a complicated subject which is clearly explained.
5
Member's Profile
Vicki's courses are always very clear and she gives realistic examples that always help.
5
Member's Profile
good wording, nice slides explaining very much in detail, perfect examples are used.
4
Anonymous Author
Good information. It does need to be updated to reflect the new 2020 W4 information.
5
Anonymous Author
Great content Vicki is always the best trainer. Will highly recommend. Thank you
5
Anonymous Author
Wonderful course, gives a lot of guidance material for further the research.
5
Member's Profile
Fantastic! Vicky is an awesome teacher! Thank you for another great course!
5
Member's Profile
Lots of information! I was surprised by the deducting overpayment rules.
5
Member's Profile
very very good. cant wait to take the courses that go into more detail
5
Member's Profile
Thank you for the great course information. What else can I say?
5
Member's Profile
Excellent refresher for what is allowed to be deducted and when.
5
Anonymous Author
The course was presented well and contained useful information.
4
Anonymous Author
Good course I learned a lot and benefitted from the experience
4
Anonymous Author
very good summary. Good examples of different state laws
5
Member's Profile
This is a very comprehensive course! Highly recommended.
5
Anonymous Author
There was a lot to go over, but it was done beautifully.
5
Member's Profile
I learned a lot and will review this course again.

Prerequisites

Course Complexity: Intermediate

No advanced preparation or prerequisites are required for this course.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .

1 QuestionCourse Questions and Answers

User picture

I have an employee with a child support order in effect and did not have enough wages to cover the order. So I withheld at 50% of disposable. Then I received a SC state tax garnishment for $34 dollars. Do you withhold the $34 in addition to the 50% disposable since the state tax is not covered under the CCPA?

Course Syllabus
INTRODUCTION AND OVERVIEW
  4:51Introduction to Deducting from an Employee’s Paycheck: When Can it Be Done?
  10:06Taxes
  8:42Taxes Continued..
  9:28Garnishments
  15:29Garnishments Continued..
  12:09Garnishments Conclusion
  7:07Fringe Benefits & uniforms
  13:55Meals and Lodging
  4:39Shortages/Breakage
  14:21Overpayments
  5:04Advance Vacation Pay
  6:34Loans and Employee Purchases
  3:48Anti-Wage Theft Laws
CONTINUOUS PLAY
  1:56:14Deducting from an Employee’s Paycheck: When Can it Be Done?
SUPPORTING MATERIALS
  PDFSlides: Deducting from an Employee’s Paycheck: When Can it Be Done?
  PDFDeducting from an Employee’s Paycheck: When Can it Be Done? Glossary/Index
REVIEW AND TEST
  quizREVIEW QUESTIONS
 examFINAL EXAM