Does your company’s payroll reflect the individual needs of each of your employees? Learn how to make an individualized employee pay stub here.
Even if the only person working for your small business is you, you still may want to generate a paystub. A paystub shows consistent income for the self-employed and is necessary when you go to apply for a loan.
So do you need to create an employee pay stub for all your employees? The answer is, it depends.
Read on to learn when and how to create an employee pay stub.
5 Tips for Creating an Employee Pay Stub
Below are some tips that will ensure you include the items on the paystub that are required by law. There are companies that will create your paystubs for you, like paystubcreator.net. They ensure that you follow all applicable state and federal requirements.
1. What Information is in a Paystub?
A typical pay stub includes the following information:
- Pay Period Dates
- Total Pay before Deductions (Gross Earnings)
- Total Pay after Deductions (Net Earnings)
- Federal, State, and Local Tax Withholding Amounts
- Insurance, Medicare, Social Security Deductions
- Retirement or Pension Plan Contributions
- Wage Garnishments
- Summary of the Total Deductions
- Summary of Year to Date Information
- Total Hours Worked
- Pay Rate
There are other things, like company name, address, contact numbers and employee information that should also be on a pay stub.
2. Does the Federal Government Require Issuing an Employee Pay Stub?
Keep in mind that while all businesses are required to keep detailed financial records, the federal government does not require an employee pay stub for employees.
3. Who Does Govern Employee Paystub?
Most states and local governments have some regulations concerning paystubs.
There are three types of state requirements: states with no requirements, states with access requirements and states with access/print requirements.
Access governs how the paystub information is delivered, either electronic or paper. Access/print requires that employees have the means to print electronic statements.
There are also opt-in and opt-out states. Opt-in states must offer paper stubs unless an employee chooses an electronic format. Opt-out states require getting permission from the employee to provide their payment information in an alternative way. For example, you need permission from the employee before you change from paper to electronic.
Check your state’s Department of Labor website to figure out what kind of state you live in and ensure you’re compliant with any applicable regulations.
4. Can Employees Ask for a Copy of Their Payroll Record?
While the payroll requirements vary by state and local government. If an employee asks for their payroll information you are required to provide it.
Most employers opt to provide an electronic pay stub as it is easier and more efficient than a paper pay stub.
5. Consequences of Non-Compliance
The results of not following the laws will vary by state because the regulations vary by state. The fees/penalties can be high for each infraction and may include the employee’s legal fees.
Keep in mind, that if you are required or asked to create an employee paystub, you can only include the last 4 digits of the employee’s social security number. If you print your own pay stub, ensure that it includes all the right information. Or, you can make your life easier and have someone do it for you.
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