In a couple of months you may start noticing your employer deducting a bit more from your paycheck but it won’t be because of a tax increase – and you’ll probably let them.
A new law that takes effect on November 6 will expand the categories for which employers can make paycheck deductions. Any deductions would still be voluntary and must be agreed to by the employee. In many instances, however, employees may consider the new allowable deductions for items ranging from prepaid legal plans to fitness center dues to be a convenience.
Until the new law was signed, employers in New York were only allowed to deduct withholding taxes, insurance premiums, pension or health benefits, charitable donations, U.S. bond payments, union dues and a few other items. Employers can now, with proper notification and written approval of employees, make deductions for a range of items, among them:
- to recover a mistaken overpayment of wages or a salary advance
- parking passes and mass transit fare programs
- gym memberships
- tuition, room and board for educational institutions
- day care
- dues for a fitness center, health club, or gym membership.
- contributions at employer-affiliated charities
The new law will expire three years after it is enacted. You can read the approved proposal in full below.