Track Employee Debt Repayments
Is there any way to track how much is paid off a debt garnished from wages? We have received a letter asking us to garnish an employee's wage with a weekly deduction. The debt will take years to repay. I was wondering if there is a way that I can enter the total amount of the debt somewhere as a limit and be able to track repayments in a report with the amounts deducted from the total leaving an outstanding balance.
Comments
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I would enter the original debt as a Loan to employee (make it an asset account), and every week when the amount is deducted allocate it to the same account. You can then do a fast report on that account and see the original debit and all the payments, and also the balance
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Thank you Kris_Willams :)
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@Kris_Williams - Whilst the approach you have recommended does meet @Kat001 's objective of showing the amount outstanding, I would be reluctant to use it. Treating the amount to be garnished as Loan to the employee and an asset is misleading as it is not an asset of the Company and in my opinion should not appear on the balance sheet.
My suggestion would be to:
- treat the weekly amount deducted as a payroll item
- using the "to do list" set up a periodic reminder to check the total amount deducted via the payroll item and compare it against the original amount due.
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Using a Payroll Item was Kris’s suggestion. It still has to be mapped to an account though so what account would you link it to Bruce ? 🤔
I think one would need to determine the correct account type based on what the debt is actually for as - if the employer needs to on-pay it - it sounds more like it may need to be a Payroll Liability account (which should definitely show as a liability on the balance sheet) 😬
Shaz Hughes Dip(Fin) ACQ NSW, MICB
*** Reckon Accredited Partner (AP) Bookkeeper - specialising EXCLUSIVELY in Reckon Accounts / Hosted ! ***
* Regd BAS Agent (No: 92314 015)* ICB-Certified Bookkeeper* Snr Seasonal Tax Consultant since 2003 *
Accounted 4 Bookkeeping Services
Ballajura, WA
(NB: Please give my post a Like or mark as Accepted Answer if I have been able to resolve your query as this helps others when seeking solutions!)
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