/
Deduction Refund for previous year payrolls
Deduction Refund for previous year payrolls
Description of Issue
An employee was withheld the incorrect health insurance deduction in a prior year, how do I handle a deduction refund for the first payroll of the new year?
Context
- Enterprise ERP Payroll
- Employee Deductions
- Payroll Start and Status
- Earnings and Deductions
Cause
Employee was withheld the incorrect deduction/amounts in prior year.
Resolution
- Contact the IRS for a recommendation on how to handle the refunded deduction amount.
- Example: Backdate refund and report in prior year with the difference or report in the new year and deal with the difference in the new year W-2.
- Once the IRS has made their recommendation, use the below link for the Deduction Refund.
Additional Information