Timing, Communication Are Keys to Successful Overpayment Recovery

June 29, 2020, 9:10 PM

Recovering overpayments that occur in multiple tax years can be challenging for employers, especially when trying to reclaim funds in subsequent years, a payroll expert said June 25.

In addition to recovering an overpayment from an employee, employers generally have to adjust federal tax reporting and payments, said Larry White, CPP, director of payroll training for the American Payroll Association.

Overpayments can occur no matter how many preventive steps a payroll professional takes because many of the mistakes take place outside the payroll department, White said. For example, employees receiving signing bonuses and relocation reimbursements but leaving the company before...

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