Reimbursements can be used to pay employees back money. For example, when employer needs to reimburse employees for incurred expenses and/or correct a reduction in one of their paychecks, a reimbursement can be used.
Note: Consult your Accounting professional to determine if reimbursements should be properly made through Payroll.
In Configuration, click Pay Types.
Create a Pay Type for the reimbursement with a pay category of Other.
Note: If reimbursing an employee for nontaxable items, ensure all withholding settings (federal, state and local) are set to Do not withhold tax or report and do not include on Line 2 of the 941.
Save and close the pay type created.
Add the pay type to the employee record on the Compensation/Deduction tab.