How do I set up the pay code in my payroll system?

Before you run your first payroll, you must create pay codes (also called deduction codes) in your payroll system for the SecureSave contributions--one for employee deductions and one for the employer match/bonus.

• For the ongoing employee deductions, name the pay code something like “ESA Deduction". This is the amount the employee is choosing to put into SecureSave from their paycheck. This deduction is pulled from the paycheck post-tax.

• For the ongoing employer match, name the pay code something like "ESA Match". This is the amount your company is adding to the employee’s SecureSave account. This contribution is imputed pay and as such, taxable to the employee as normal pay. By treating as imputed pay, the total pay is increased by this amount so that the funds are taxed, then the full amount of the incentive is added to the SecureSave account post-tax (example: if the match is $5, the employee is taxed on the amount, but the full $5 is added to the SecureSave account).

• For the one-off employer bonuses, either include in the employer match pay code OR create another pay code named something like “ESA Bonus”. Follow the set-up instructions above for employer match.

If uncertain how to create a pay code, we advise working with your payroll vendor or specialist to create these pay codes.