This article explains the steps necessary to charge an employee for childcare and withhold the amount from their paycheck. The same person is used as the payer in Family Data & Accounting and the employee in Employee Data & Payroll.
Before you Begin
You will need:
- A withholding formula (see below) to deduct childcare fees from an employee’s paycheck.
- Charge and Credit Descriptions to charge the employee’s family ledger card for tuition and credit it for the amount withheld from their check.
- Optional: You may wish to create a unique revenue account in your Chart of Accounts, such as 4006.00 Employee Child Care (or something similar) specifically for employee child care fees. You could then assign that account number to the charge and credit descriptions. Or, just use the standard tuition revenue number 4000.00.
Download & Import the Child Care Withholding Formula
- Go to Download Withholding Formulas. Follow the directions to download the Employee Child Care formula, saving it to a location on your computer you can remember, such as your desktop.
- Import the formula to Procare.
- From the Procare Home screen, go to Configuration > System > Accounting Management > Payroll > Payroll Formulas. Double-click Payroll Formulas.
- Click the Import Formula button at the bottom.
- Navigate to the location on your computer where you saved the downloaded formula file, such as your desktop. Select the file, named ChildCare.PFD, then click Open at the bottom. The file will be imported as a General Withholding formula.
Create the Employee Child Care Revenue Account number (Optional)
Assign the Revenue Account number to the Withholding
- From the Procare Home screen, go to Configuration > System > Accounting Management > Payroll > General Ledger Assignments. Double-click General Ledger Assignments.
- Select the Category General in the upper left corner.
- In the GL Account box to the right of Subclass CCARE select the correct revenue number, i.e 4000.00 Tuition Charges or the one you created.
Note: Revenue is recognized when the employee is issued a paycheck. The tuition is deducted from the check, increasing this revenue account number.
Create the Employee Tuition Charge & Payroll Deduction Credit descriptions
- From the Procare Home screen go to Configuration > System > Family Accounting > Charge / Credit Descriptions.
- Double-click Charge / Credit Descriptions to add the following:
- Your Choice: Use a standard charge description, like “Tuition Infants”, etc., or click the Tuition Charges tab to add a new one, like “Employee Child Care Tuition”. Choose a GL Account, like 4000.00 Tuition or 4006.00 Employee Child Care.
- Required: Click the Credit tab and add a credit description, like “Payroll Deduction”. This is a revenue account, because the credit will be treated as negative revenue. Again choose a GL Account, like 4000.00 Tuition or 4006.00 Employee Child Care.
Note: You may use the same account number for both the charge and credit or different numbers depending on whether you wish to lump everything together (charges and credits) or have them separated.
Assign the Withholding to the Employee
Assign the downloaded General formula in the employee’s Withhold button.
Set Up the Child Billing Box
- If you have not done so, Create an Account for the employee and Add the Child. Be sure to add the employee as an “existing” person for the account.
- Assign the tuition charge AND the Payroll Deduct credit description to the Child’s Billing Box. Each time billing is run, the charge and credit offset each other.