If your benefits are managed by Gusto (including the broker integration) and a deduction was missed, we’ll apply corrections to upcoming payroll(s) to catch up on the missed amounts. These deductions cannot be manually skipped.
If your benefits are managed by your company or another broker outside of Gusto, deduction corrections are not automatic. You'll need to edit a deduction to add and remove corrections as needed.
When benefit deduction corrections may apply
For Gusto-managed benefits, here are some examples of missed deductions we'll automatically apply benefit deduction corrections for:
The way corrections apply depends on the type of benefit deduction that was missed—learn more about each benefit type below.
If you have questions or do not want these deduction corrections to occur, contact us through the Help section of your account.
If an employee’s health benefits deductions were missed, we’ll apply 1.5x the normal deduction amount to upcoming payrolls until the missed amount is captured. This is listed in a line item under the benefit called "Correction." For every payroll with missed deductions, it takes 2 payrolls to catch up at 1.5x.
Ex: If we missed 1 deduction that's normally $100 per paycheck, the next two payrolls will have $150 deducted. Once the full amount is captured, only the regular deduction amount will be applied moving forward.
2% shareholder deductions will be taken from the shareholder’s first paycheck after benefits begin as imputed pay. Because the IRS does not permit shareholders to take part in employer-sponsored (pre-tax) health benefits, the full amount will be added to the following paycheck because imputed pay is subject to federal and state income taxes.
If you have a Health or Dependent Care FSA, missed deductions will be adjusted and equally applied to the rest of your deductions throughout the plan year.
If you miss your first HSA or commuter deduction of the month, your full monthly election will be applied to the remaining payroll(s) of that month. If the deductions cannot be fully caught up in the same month, the corrections will continue to appear on future payrolls until caught up.
If benefits were over-deducted (ex: a QLE was submitted or processed late), we'll create a benefit reversal. In this case, we'll send you an email detailing the correction and any action you need to take.