Payroll Services Reductions and Deductions
Click to enlarge

Reductions

Reductions are items which have been defined by the Internal Revenue Code to not be subject to certain taxes. For example, the Dependent Care Program provided by the State of Washington is one such plan where the value of the amount withheld from a person’s paycheck is exempt from both social security and federal income tax. Similarly, the amount withheld for medical premiums has been defined in the same manner. The value of the amount withheld is not subject to social security or federal income tax. Items in this category may also be known as pre-tax.

To view a list of reductions, click here.

Deductions

Deductions are amounts withheld from gross pay on either an optional or mandatory basis. Optional deductions are amounts withheld for credit union, union dues, parking fees. Mandatory deductions may be amounts withheld for medical aid, social security, garnishments and IRS levies. Deductions may be referred to as post-tax.
To view a list of deductions, click here.