Employee Benefits Administration Flashcards

What ADP configuration step is required to ensure employer HSA contributions are excluded from FICA taxes?

Answer: Set the employer HSA contribution as a non-taxable benefit code exempt from Social Security and Medicare

Employer HSA contributions must be coded as non-taxable in ADP so they are excluded from FICA (Social Security and Medicare) withholding.

Which ADP tool allows employees to view their benefits elections, change voluntary deductions, and update beneficiaries?

Answer: ADP Employee Self-Service (ESS)

ADP Employee Self-Service allows employees to independently manage benefits elections, beneficiary designations, and voluntary payroll deductions.

What does 'benefits in kind' mean in the context of ADP payroll and why does it matter?

Answer: Non-cash compensation (like a company car) that must be valued and added to taxable wages

Benefits in kind are non-cash perks that have taxable value; ADP requires their fair market value to be added to gross wages for proper tax withholding.

In ADP, when an employee elects a dependent care FSA, what is the 2024 IRS contribution limit for a married couple filing jointly?

Answer: $5,000

The IRS limits dependent care FSA contributions to $5,000 per year for married couples filing jointly (or a single taxpayer).

Which ADP report confirms that an employee's year-to-date benefit deductions match their benefit elections on file?

Answer: Benefits Enrollment vs. Deductions Reconciliation Report

The Benefits Enrollment vs. Deductions Reconciliation Report in ADP compares what was elected during enrollment against what was actually deducted from payroll.

What is the ADP-recommended process to handle a benefits deduction that was missed due to a payroll error?

Answer: Process a retroactive adjustment in the next pay period after confirming the employee's written consent if the amount exceeds normal deduction limits

ADP recommends processing a retroactive catch-up deduction in the next available payroll cycle, ensuring compliance with applicable state wage deduction laws and employee consent requirements.