CFAA(LEGAL) - PAYROLL PROCEDURES: SALARY DEDUCTIONS AND REDUCTIONS
Except as otherwise provided in 26 U.S.C. 3402, every employer making payment of wages shall deduct and withhold upon such wages a tax determined in accordance with tables or computational procedures prescribed by the Secretary of the Treasury. 26 U.S.C. 3401–3402
The tax imposed by 26 U.S.C. 3101(b) shall be collected by the employer of the taxpayer hired after March 31, 1986, by deducting the amount of the tax from the wages as and when paid. 26 U.S.C. 3102(a), 3121(u)
Teacher Retirement System
Each payroll period, each employer shall deduct from the compensation of each member employed by the employer the amount required by Government Code 825.402. Gov't Code 825.403
Each employer shall pick up the employee contribution required of each of its employees by Section 825.403. Employers shall pay to the retirement system the picked-up contributions from the same source of funds that is used in paying earnings to the employees. Such payments shall be in lieu of contributions by the employees. An employer shall pick up these contributions by a corresponding reduction in the cash salary of the employees, by an offset against a future salary increase, or by a combination of a salary reduction and offset against a future salary increase. Employees do not have the option of choosing to receive the contributed amounts directly instead of having them paid by the employer to the retirement system. Gov't Code 825.409(a)
Retired School Employees Group Insurance Fund
The employer of an active employee shall monthly:
- Deduct the employee's contribution from the employee's salary and remit the contribution to the Teacher Retirement System of Texas (TRS) in the manner required by TRS; or
- Assume and pay the total contributions due from its active employees.
"Active employee" means a contributing member of the TRS who is employed by a public school and is not entitled to coverage under a plan provided under Insurance Code Chapter 1551 (Texas Employees Group Benefits Act) or 1601 (State University Employees Uniform Insurance Benefits Act).
Insurance Code 1575.002(1), (7), .203(b)
Child Support Payments
An employer shall begin to withhold income in accordance with an order or writ of withholding issued under Family Code Chapter 158 not later than the first pay period following the date on which the order or writ was delivered to the employer and shall continue to withhold income as required by the order or writ as long as the obligor is employed by the employer. The employer shall remit the amount to be withheld to the person or office named in the order or writ on each pay date. The payment must include the date on which the withholding occurred.
An employer may deduct an administrative fee of not more than $10 from the obligor's disposable earnings in addition to the amount withheld as child support.
Family Code 158.202–.204
An employer shall begin to withhold income in accordance with an order or writ of withholding issued under Family Code Chapter 8 not later than the first pay period after the date the order or writ was delivered to the employer. The employer shall continue to withhold income as required by the order or writ as long as the obligor is employed by the employer. The employer shall remit to the person or office named in the order or writ of withholding the amount of income withheld from an obligor on each pay date. The remittance must include the date on which the withholding occurred.
An employer may deduct an administrative fee of not more than $5 each month from the obligor's disposable earnings in addition to the amount withheld as spousal maintenance.
Family Code 8.202–.204
The tax imposed by 26 U.S.C. 3101(a) shall be collected by the employer of designated taxpayers by deducting the amount of the tax from the wages as and when paid. 26 U.S.C. 3101–3102, 3121(b)(7)(E); 26 CFR 31.3121(b)(7)-2
Federal Education Loans
An employer shall pay to the U.S. Secretary of Education or the guaranty agency as directed in a withholding order issued in an action to recover delinquent federal education loan payments. 20 U.S.C. 1095a(a)(6)
Prepaid Higher Education Tuition Program
An employee of an ESC may make payments under a prepaid tuition contract by payroll deductions made by the appropriate officer of the ESC. Education Code 54.626(c)
Higher Education Savings Plan
An employee of an ESC may make contributions to a higher education savings trust account established under the higher education savings plan by payroll deductions made by the appropriate officer of the ESC. Education Code 54.701(10), .708(a)
An ESC may withhold from an employee's salary contributions for participation in approved insurance programs. [See CRD] Insurance Code 1579.253; Education Code 22.005
An ESC may enter into a salary reduction agreement to reduce an employee's salary for the purpose of making direct contributions to or purchases of a qualified investment product only if the qualified investment product is an eligible qualified investment. To the greatest degree possible, ESCs that enter into a salary reduction agreement with employees under this provision shall require that contributions to eligible qualified investments be made by automatic payroll deduction and deposited directly in the investment accounts. Art. 6228a-5, Secs. 4(5), 5(a), (f) V.A.T.S.
An ESC may contract with an employee for the deferment of any part of the employee's compensation. To participate in a deferred compensation plan, an employee must consent in the contract to automatic payroll deductions in an amount equal to the deferred amount. [See CRG] Gov't Code 609.007(a), (c)
An ESC shall withhold from an employee's salary amounts designated by the employee for participation in the ESC's cafeteria plan authorized under Section 125. 26 U.S.C. 125
An ESC that is required by state or federal law to deduct from the current wages of an employee an amount garnished under a withholding order may deduct monthly an administrative fee from the employee's disposable earnings in addition to the amount required to be withheld under the withholding order. This does not apply to income withholding under Family Code Chapter 158. [See Child Support Payments, above]
The administrative fee may not exceed the lesser of:
- The actual administrative cost incurred by the ESC in complying with the withholding order; or
Civ. Prac. & Rem. Code 63.006