From time to time, your household employee may ask you for an advance (i.e., a loan) against his or her wages. NannyPay makes the process of paying and tracking advances simple. Record advances according to the following steps:
- Click on the "Advance" transaction type in the lower drop down box of the Payroll Check window;
- Enter the desired amount in the yellow amount box; and
- Click the "Calculate" button.
You will see that NannyPay enters the advance amount in its registers but does not subtract deductions. That's because NannyPay treats an advance as a loan against your household employee's net pay. The next time you pay your household employee you will be prompted with this window:
Once this window appears, you have three choices:
- Enter an amount to be deducted from your household employee's net pay. This can be any amount so long as it does not exceed net pay or the amount of the outstanding advance. Click "OK" when you're done; or
- Tell NannyPay to remind you next time you make a payroll transaction by clicking on the second button; or
- Tell NannyPay that you don't want to make any deductions from your household employee's net pay, and not to remind you again. Be aware that a forgotten advance, or loan forgiveness, may actually be considered income to your household employee, so before using this option, you should consult with your tax professional about its tax implications.
If you deduct only part of the original advance, NannyPay will continue to remind you to deduct the remaining balance every pay period until it is entirely deducted, or until you instruct NannyPay to stop reminding you. If there is a balance remaining on an outstanding advance that has not been deducted, you will be presented with the following window with a slightly different message:
You have the same three choices as explained above: (1) deduct some or all of the advance; (2) tell NannyPay to remind you next pay period; or (3) tell NannyPay to stop reminding you.
NannyPay's Automatic Advance Feature