Deduction balance type

A deduction balance type determines how a deduction is taken for a specific employee. An employee deduction can have one of three balance types:

  • Ascending—the life-to-date contribution of the deduction. Life-to-date contribution is the accumulation of all year-to-date amounts taken by the deduction since the deduction started.

  • Descending—the balance amount decreases by an amount or percent until it reaches zero, at which time Payroll no longer takes the deduction.

    Note: If you allow employees to exceed the Federal 403b contribution limit, define 403b Defined Contribution Plan deductions with a limit balance type.

  • Limit—Payroll takes an amount or percent until the year-to-date equals the balance amount at which time Payroll no longer takes the deduction.

Example

Jan Brown, at Two Rivers Company, has decided to contribute to United Way this year. She informed the payroll office that she would like to contribute 5.00 on a pay period basis, up to a maximum of 100.00 for the year. The deduction was established as a Descending type employee deduction with 5.00 entered in the amount field and 100.00 entered in the Balance Amount field.