Exclude from gross pay presentation - Examples

Alerts and notices

When you exclude the hours or amounts of a payroll item from gross pay presentation, the item is excluded from an employee's gross pay, but the details for that item will be included in the check entry screen, on payroll check stubs, and on reports. 

The following examples show situations in which you might choose to exclude the hours, amounts, or both from gross pay presentation.

Example 1: Excluding a payroll item Amount from gross pay presentation


In this example, we have marked the Amount from gross pay presentation checkbox for an employee reimbursement pay item. 

Typically, this isn't money that an employee has earned. These amounts could be for items such as fringe benefits including, but not limited to, gym memberships, transportation benefits, FSAs, tuition reduction, or adoption assistance. But these amounts are still subject to payroll taxes and must therefore be included in the gross pay total (for tax calculation) and in the net pay amount. The amount will be excluded from the gross pay presentation, though.

The payroll check entry screen shows the employee receiving his $1000.00 salary amount and a $125.00 reimbursement amount

 exclude-hours

 In the payroll check entry screen:

  • The $125.00 reimbursement amount is displayed in the details, but is not included in the Gross Pay total, which shows only the $1000.00 salary amount.
  • The taxes calculated based on the entire $1,125.00 (salary + reimbursement).
  • The net pay ($890.11) calculated based on the entire $1,125.00 minus the total tax amount ($234.89).

The same information displays in the payroll check stub and in reports.

 Exclude amount stub

Example 2: Excluding Hours from gross pay presentation


In this example, we have marked the Hours from gross pay presentation checkbox for a shift premium pay item.

This employee earns $20 an hour for his normal (first) shift, but is paid an additional $10 per hour shift premium for working third shift. We set up the Wages pay item for our employee, using an hourly rate of $20. We have then set up a Shift Premium pay item, using an hourly rate of $10, and marking the Hours from gross pay presentation checkbox to make sure that the rate, but not the hours, are included in the employee's totals. 

As shown in the screenshot below, the Gross Pay total hours includes only the 40 hours actually worked by the employee, but the Gross Pay total ($880.00) includes both the $800.00 wages amount and the $80.00 shift premium amount.

Exclude hours from gross pay presentation

Note: If we didn't mark the Hours from gross pay presentation checkbox, Accounting CS would add the 8 shift premium hours to the 40 hours, making it seem as if the employee had worked 48 hours total rather than the 40 hours he actually worked. This difference is important for Affordable Care Act (ACA) reporting and also for a number of states (such as WA), where certain forms report the number of hours that an employee worked.

The same information displays in the payroll check stub and in reports.

Exclude hours from gross pay presentation - checkstub

Example 3: Excluding Amount and Hours from gross pay and excluding from net pay


In this example, we have marked the Amount from gross pay presentation checkbox, the Hours from gross pay presentation checkbox, AND the Net pay checkbox for a Reported Tips pay item. 

In this situation, the employee has already received the Reported Tips amount ($250), because he received it directly from his customer.  Therefore, we don't want to include that amount in either the gross pay amount or the net pay amount.  But we do want to include the details on the check to ensure that the correct tax calculations are made for the employee.

The payroll check entry screen shows the employee receiving his $120.00 Tipped Wages amount and shows the $250.00 Reported tips amount

Exclude hours, amount, and net pay

The same information displays in the payroll check stub and in reports.

 

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