Payroll Tip: Know Your Fringe Benefit Rules

Know Your Fringe Benefit Rules

Union and prevailing wage payrolls give you a lot to keep track of — between rates for multiple trades and multiple rates for benefit types — but make sure too that those rates aren’t all calculating the same. Some fringes are subject to overtime while some are calculated by percentage; some are pre-tax and some subject to FICA. Not knowing the rules on calculating these benefits accurately can cost you one way or the other.

If we overpay on our taxes, the IRS is good about giving us a refund, but if you overpay on union or Davis-Bacon fringes, you might as well consider it a donation — without the write-off. That overage isn’t coming back to your company account.