Payroll advance reimbursement

When an employee receives negative net pay, the advance can be paid back in two ways:

1. The employee brings in a check to reimburse the district.
2. The district sets up a payment plan to automatically deduct pay over one or more future pay periods to recover the loaned amount.

Direct reimbursement

If the employee brings in payment to reimburse the district, create a direct reimbursement to record the deposit:

1. Go to Financials Main > Payroll > Payroll Advances
2. Select a payroll run
3. Click Reimburse next to the employee that brought in a check
4. Fill out the necessary details
5. Save

The General Journal will show a debit to the bank account and a credit to the payroll advance account.

Payment plan

If the employee should have money deducted from future paychecks, create a payment plan. The payment plan will automatically create post-tax deductions over the specified future pay periods. SchoolInsight can predict the amounts needed to repay the advance evenly over the rest of year, or you can make adjustments to allow the employee to make larger repayments over a shorter period of time.

To create a payment plan:

1. Go to Financials Main > Payroll > Payroll Advances
2. Click the down arrow next to an employee to reveal and select View
3. Create Payment Plan
4. Select the position that will have pay deducted to pay back the advance
5. Deduct from Net Pay Function should be set to the same liability function used on your Wage payroll items.
6. The system will take the amount owed and divide it across the remaining pay periods in the fiscal year. To make changes, you can remove pay periods and adjust the amount that will be withheld from each paycheck.
7. Save

Similar to paying liabilities, in order to move on and complete the payroll run, you must either fully reimburse or skip any outstanding balances.  After you have created a payment plan above, when the employee won’t be making a payment this pay period (the pay period they incurred the negative net pay), they will need to be marked skipped on the Payroll Advance page for this pay period and any future pay periods where the remaining balance is not paid in full.  This is required to mark the payroll run complete.

Skipping Negative Net Pay:

1. Go to Financials Main > Payroll > Payroll Advances
2. Select the payroll run the negative net balance was incurred on from the dropdown menu
3. Next to that employee, click Skip
4. Ensure that you have selected the correct employee, payroll run and amount and click Skip
5. Your employee will now appear with a green checkmark in the complete column
6. You can return to the payroll runs page and edit the status to complete

On future payroll registers, the employee will have a post-tax deduction labeled “Reimburse Payroll Advance.” This amount will affect the general journal by debiting the payroll liability account and crediting the payroll advance asset account.

If an employee wishes to deduct extra from their paycheck in order to pay off the advance faster, that change should be made on the Payroll Advances page by editing future payments. The amount should not be overwritten in the payroll register.

If a payment plan was partially followed, but an employee decides to give a check instead of following the rest of the payment plan, use the direct reimbursement method above to record the check. Then edit the payment plan afterward to remove any future payroll deductions.