Deductions Overview
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Description
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A deduction is a monetary amount subtracted from an employee’s taxable income that reduces the amount paid on a pay statement.
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Concepts Video Gallery
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A deduction is a monetary amount subtracted from an employee’s taxable income that reduces the amount paid on a pay statement.
It’s the employer’s responsibility to submit and report payroll taxes and statutory deductions that have been calculated for every employee. This video reviews how businesses pay taxes and how they report those payroll taxes.
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Earnings identify different types of employee compensation for services provided. Earnings can also include specific parameters such as accounting rules, tax laws, and reporting requirements.
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A general ledger is a journal containing accounting transactions related to a company’s assets, liabilities, equity, revenue, and expenses.
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The pay statement, also known as a pay stub, includes the details of the employee’s pay for that pay period. Pay statement details help employees understand their pay and check for inaccuracies.
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Payroll taxes are calculated based on the total compensation of each employee. Federal and State withholding taxes are based on the Form W-4 information for each employee.
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The Pay Periods Profile defines the frequency for paying employees and drives the pay dates for payroll.
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