A few states, including New Jersey and Pennsylvania, require employees to pay SUTA via payroll deduction. An employer-paid federal payroll tax which is used to help fund the unemployment insurance system. Also provides a fund that states can borrow from for unemployment benefits purposes. The federal, state, and local taxes an employee is legally required to pay (though payroll withholding).
Some payroll companies use their own set of these abbreviations while some don’t. In this article will cover pay stubs abbreviations from all major payroll companies like ADP, QuickBooks, Paychex, Ariba, E-Verify and Paycom. Pay period is the window of time — usually biweekly or monthly — that determines when paychecks go out. Refers to when an employer pays employees twice per month, such as on the 15th and last day of the month. The process of verifying payroll transactions and ensuring they are accurate.
A fraud detection tool that matches employer-issued paychecks against a list of authorized checks. A daily allowance paid to employees to cover the cost of travel-related expenses for work. A tool used to record and track an organization’s employee and contractor payment data. The idea that employees doing the same work should receive the same pay, regardless of demographics. When employees receive the same pay despite having different levels of experience, skills, or qualifications. A benefit that provides additional paid leave due to an extended illness or severe injury.
How does workers’ compensation relate to payroll?
Accurate timesheet management is essential for small business owners to ensure employees are paid correctly for their time. Take-home pay what is a full charge bookkeeper is the employee’s wages that remain after all normal deductions and taxes are taken out. Overpayments can be corrected in various ways, including reducing the overpaid employee’s future wages.
Employee Net Promoter Score (eNPS)
A salaried employee receives a fixed annual income, divided across pay periods throughout the year. Unlike hourly employees, their pay isn’t based on the number of hours worked. This model offers stability for both the employee and employer; however, it requires clear communication regarding expectations and responsibilities. Salaried employees can be exempt from overtime, but they aren’t always, so make sure you’re classifying your workers correctly. Refers to the state taxes an employer is required to withhold from employees’ wages, such as state income tax and SDI tax.
Withholding
- This limit is determined by the combined total of all plans an employee paid toward and will change from year to year.
- The W-2 Form is a tax document that reports all employee earnings in addition to taxes and deductions withheld.
- The total sum of money an employee earns before taxes and withholdings are applied.
- The amount withheld is determined by the employee’s earnings and the information provided on their W-4.
- The payroll authorization form is a document that authorizes payroll changes, such as salary adjustments, bonus payments, or terminations.
It is a safe way to transfer money between banks and credit unions and reduces the needs for paper and checks. No matter your involvement with payroll at your business or organization, we have broken down some of the most common payroll definitions and terms to know. Exempt and nonexempt employees are defined by their eligibility for overtime, which is determined through the Fair Labor Standards Act (FLSA). Unless you’re in HR, payroll terminology and abbreviations can be intimidating. But when the process is understood by everyone, the shared knowledge it brings how to prepare a bank reconciliation elevates an entire organization. In large food and beverage establishments, if all reported tips are less than 8% of the total gross sales, the employer must allocate the difference.
Federal payroll taxes used to fund Social Security and Medicare programs. Both of these retirement plans offer employees a way to save for retirement with tax different types of revenue and profits for startup accounting advantages. A 401(k) is an employer-sponsored retirement plan, while individuals can open an IRA independently.
This guide can help you create your employee handbook, which you can start building with this tool. Click on any of the letters below to jump to words that start with that letter. For more help with running your business, check out our glossaries for HR and benefits terms, too.
