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How to Set Up Child Support Deductions in Patriot Software

Background

If you receive a child support withholding order for an employee, you will need to set up a deduction to withhold child support payments from the employee’s paycheck.  For more information about administering child support withholding orders, visit the Office of Child Support Enforcement website.

Steps to set up a child support deduction

You will first need to set up a deduction at the company level, and then assign it to the employee.  Here are the steps to add the deduction at the company level.  You will do this one time:

Settings > Payroll Settings > Deductions & Contributions

  1. Click “Add New.” 
  2. For the “Type,” select “Post-Tax % Disposable Net Pay.”  Child support deductions are taxable and included with gross wages when calculating income tax.
  3. For the Description, enter “Child Support” or something similar.
  4. For the Method, select “Percent.”  Most child support orders indicate a fixed dollar amount that should be deducted from the employee’s pay, but these amounts are subject to percent limits.  For more details, see the article What Employers Should Know About Child Support Withholding.
  5. Leave the “Amount” field blank at the company level.  Since this will change for each employee, you will enter the amount when you add this deduction to the employee’s record.
  6. You can leave the W-2 Box blank unless you want to show the child support payments for information purposes on the employee’s W-2.  This is optional.
  7. Leave the “Limits” blank at the company level.  You will enter these when you set up the employee’s deduction, based on each employee’s child support order.
  8. Click “Save.”

If you have more than one child support deduction that needs to be added for the same employee, you’ll need to repeat the above steps.  We recommend you name any additional deductions “Child Support 2,” “Child Support 3,” etc, so that you can track each one separately.

Now that you have added this deduction at the company level, you can now assign it to your employee.  Note the example below addresses a single child support order for an employee.  Employees with multiple child support orders are more complex and may require calculations outside of the software to ensure correct amounts are being deducted.

Payroll > Employees > Employee List

  1. Select the employee in the list.
  2. Click the “Deductions & Contributions” link on their record.
  3. Click “Add New.” A set of blank fields will appear.
  4. For Deduction, select “Child Support” from the list of deductions you have created at the company level.
  5. The Method of “Percent” will be automatically selected, since you set this up at the company level.
  6. The Amount Per Pay is the percentage of disposable income to be withheld, normally ranging from 50% to 65%, as determined by federal withholding guidelines.  Your state may have a lower limit than the federal guidelines.  For more information, see “What Employers Should Know About Child Support Withholding.” 
  7. Under the Limits section, enter the Pay Date limit as the amount listed on the child support order to be withheld each pay date.  You may need to do some math to figure the dollar limit per pay period if you are given a monthly amount.   
  8. Click Save.

For example, a Child Support Income Withholding Order says to withhold $200 per month and indicates that the employee is not past due. This employee is single, does not support a second family, lives in a state that follows the Federal CCPA limits and is paid biweekly. To correctly calculate this employee’s Child Support deduction, you would enter 60% in the Amount Per Pay field (based on the CCPA limits for a single employee that is not past due) and $92.31 in the Pay Date Limit field ($200.00 / month x 12 months = $2400.00 / year divided by 26 biweekly pay periods = $92.31 deducted per pay date).

The child support deduction will be taken from the employee’s payrolls going forward.  Child support payments are not remitted as part of our Full Service payroll tax option.  It is your responsibility to remit the child support deductions to the appropriate agency on time.  

Disclaimer:  The above is not to be construed as legal advice.  You are responsible to ensure deductions are calculated correctly based on the federal and state laws applicable to your business, your employees, and the situation surrounding each child support order.

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