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joshhaverland-gm
Level 1

When a health insurance payroll deduction is added on a paycheck where does the money deducted go? Shouldn't it come back to my business?

We cover 75% of monthly healthcare costs and the 25% is deducted from paychecks. After running payroll the first time I do not see that deduction coming back to my company to help pay for that insurance cost
3 Comments 3
FishingForAnswers
Level 10

When a health insurance payroll deduction is added on a paycheck where does the money deducted go? Shouldn't it come back to my business?

@joshhaverland-gm  It never left your business in the first place.

 

Say I owe you $100.00.

 

I decide to knock off $25.00 for something you owed me.

 

I hand you $75.00 and keep $25.00 in my pocket.

 

Similarly, if you deduct 25% of healthcare costs from an employee's paycheck, you are lowering their net pay, the amount you are paying them.

 

So, it is not that the money isn't coming back to your company; it's that it never left it in the first place. You lowered the paycheck amount, and the difference (25%) stayed in your bank.

Candice C
QuickBooks Team

When a health insurance payroll deduction is added on a paycheck where does the money deducted go? Shouldn't it come back to my business?

Hey there, @joshhaverland-gm

 

Welcome to the Community! 

 

Let's talk a further look at your deduction and how you set it up. Please provide us with a screenshot or any additional details about the deduction that you have. 

 

For further information, check out this guide about employee deductions that can help you now and in the future. 

 

This will help us determine the next steps you need to take. I'll be waiting for your response! 

FishingForAnswers
Level 10

When a health insurance payroll deduction is added on a paycheck where does the money deducted go? Shouldn't it come back to my business?

@Candice C  It's a deduction from the paycheck.

 

The only way the business is going to see money deposited back into the account is if the OP writes a check to themselves for the amount of the liability.

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