Super User Access Required
Payroll Deduction Tool
The Payroll Deduction Tool is a convenient functionality that allows clients to post deductions to Healthcare Flexible Spending Accounts (HCFSA), Dependent Care Flexible Spending Accounts (DCFSA), and Health Reimbursement Arrangements (HRA) in a systematic manner in lieu of sending payroll funding files to report employee contributions on a pay period basis.
It is based on a payroll calendar that you provide for each calendar year. This tool enables you to post payroll deductions for any pay date that falls within a plan's period. Deductions are calculated based on the number of non-skipped pay dates remaining until the plan end date.
Note: Ensure Auto Funding feature is ON, in order for funding files to post automatically. (Located under the Payroll Group Page.) Only HealthEquity contacts can enable or disable Auto Funding. Please reach out to HealthEquity Client Services to activate.
Annual Payroll Calendar Setup
Each year, the payroll calendar must be set up to reflect the new pay periods. (Any missed pay periods will require manual funding since the calendar cannot post any past payroll dates.)
Go to Benefits > Payroll.
Click on an already existing Payroll Group.
Select ‘Add new HCFSA & DCFSA Calendar’, ‘Add New HRA Calendar’ or ‘Add New Commuter Calendar.’
Select a Calendar year using the dropdown.
Select a Frequency using the dropdown.
Indicate the First Payroll Date of the year.
Select ‘Create Calendar.’
Click ‘Save.’
Note: When setting up the payroll calendar for a new plan year, DO NOT create a new payroll group. Multiple payroll groups are only needed if the group has multiple payroll timings (bi-weekly, monthly, semi-monthly).
Payroll Groups are used to define the various payroll frequencies an employer may have. The payroll groups are then associated to each employee in order for the contribution schedule to align with each pay frequency based on the payroll calendar. An employee can be associated to a payroll group when an employee’s eligibility record is created/reported.
If a new payroll frequency is needed to be established, simply click on the Add a Payroll Group link to add a new payroll group.
For midyear plans: Please ensure both calendar years are created to calculate amounts correctly by following the same process for each year.
Example: Plan range is 06/01/2024 – 05/31/2025
A calendar will need to be created for both 2024 and 2025.
If you must change any dates (e.g., regular pay date falls on a holiday), type in the correct date and select the Preview link at the bottom of the calendar. Select SAVE in the upper right.
Note: ‘Payroll Group’ does not apply to Commuter Order Model (COM) setup because commuter deductions are specifically based on orders placed by members directly. Orders are only funded once a month.
For Commuter Account model (CAM): The CAM payroll calendar is set up only for members to know when funding will take place on their accounts. Members can view the payroll calendar in full on the Member Portal by selecting ’Payroll Calendar’ under the Manage Account menu on the Dashboard.
The calendar does not replace the need to send a funding file. Clients will still need to send funding files to fund members’ accounts.
Posting deductions using Payroll Deduction Tool
The tool allows manual funding and posting of your employees’ payroll deductions.
If your payroll varies from month to month, you may want to take advantage of this functionality.
You may also use the Payroll Deduction Tool to preview payroll deductions before they post or view previously posted deductions.
Posting FSA contributions must be completed on a pay frequency basis for reports to reflect accurate data and to ensure that members, especially DCFSA members, have access to benefits.
Tip: Set up a calendar reminder to ensure you post deductions to member accounts in a timely manner and that you have a secondary backup who knows how to execute this process in your absence.
Important Note: You are required to take action to post deductions and complete the process. This will only occur automatically if auto-funding is chosen. If auto-funding is selected, a payroll file (PSF) will be generated and loaded automatically based on the payroll dates. However, you can still make updates and should review it for accuracy.
Steps to Post Deductions
From the Payroll Deduction Tool page, select ‘Post Deductions’ on the right-hand side of the page.
In the HC & DC DEDUCTIONS section of the page (boxed in blue), select the appropriate values in each field and then select ‘DISPLAY.’
Review the employee deductions at the bottom of the page for accuracy.
Make any necessary changes and choose ‘Select All.’
Check marks will appear next to each employee’s name to indicate the records that will post.
Select ‘Submit Selected Deductions.’
Select ‘Post Selected Deductions.’
Once submitted, you may view File Status under FILES tab. Please allow up to 48 hours for processing.