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Payroll deductions are amounts withheld from an employee's payroll check, and these amounts are withheld by their employer. Among these deductions are insurance pension contributions, wage assignments, child support payments, taxes, and union and uniform dues. Deductions that are mandated are government taxes; however, all other deducted amounts are voluntary.
No matter how many hours an employee has worked, payroll deductions must be withheld from payroll checks. In the event that no deductions are withheld, the employer becomes liable and responsible for any mandated amounts that were supposed to be withheld. When an employee's insurance deductions are not withheld, the employer becomes liable to pay the deductions or to cancel the employee's insurance policy. It is always an employer's responsibility to make sure any payroll deduction is withheld in a timely manner.
Government-mandated payroll taxes include Medicare taxes, Social Security taxes and federal income taxes. Voluntary deductions are amounts paid for items such as 401(k) plans, insurance plans and sometimes union and uniform dues. Child support payments can be automatically withheld from an employee's payroll check, as well as garnishments that are court-ordered.
All voluntary payroll deductions are withheld from every payroll check an employee receives, even including any bonus and commission checks they receive. All mandated amounts deducted also come out of every payroll check.
The payroll department of a business is solely in charge of withholding the correct amounts from employee's payroll checks. For small businesses without a payroll department, the responsibility falls on the owner. Any amounts not correctly withheld are the business' responsibility to pay.