FAQs about Mapping Deductions in Zenefits

Deduction code mapping is the process of linking benefits information from Zenefits with benefits information in your payroll account. Mapping uses unique deduction codes that unambiguously identify each type of benefit. When you assign the same code to the same information in both systems, Zenefits knows which deductions to update, and when.

Once you've assigned these codes to link benefits information, when employees make changes to their benefits in Zenefits, Zenefits will automatically push these updates to the corresponding deductions in payroll, and the payroll system will adjust employees' paychecks accordingly.

Benefits information lives in two places: in Zenefits and in payroll. By assigning codes in Zenefits to the benefits you offer your employees, you can ensure the link between employee benefit information in Zenefits and in payroll.

For example, let’s say your company offers a medical insurance plan and a dental plan. If they were labeled with codes of “Deduction 1” and “Deduction 2,” Zenefits won't know which deduction code corresponds to your employees' dental and medical plans in Zenefits, and won't be able to automatically push deductions to payroll. In this case, the codes should be changed to names that clearly identify the type of benefits they apply to, e.g., "Medical" and "Dental".

When you're assigning codes to your benefits in Zenefits, you can assign only one code to each benefit. For example, medical insurance in Zenefits can be assigned a code of "Medical 1" or "Medical 2", but not both at the same time. If you have multiple codes in payroll for the same benefit, you'll need to chose which one you want Zenefits to use, or create a new one.

Once you decide on a new code (or create one), you'll need to update the deduction mapping in Zenefits, and then either enter zeros for the older code or delete it from the employee entirely to avoid over-deducting them.

You can use the same deduction code for up to three lines of coverage in Zenefits. Benefits that share the same deduction code are termed "grouped benefits." For instance, you can create one deduction code – say, “Health” – and then assign it to your medical, dental, and vision benefits in Zenefits to group them together.

If you're going to use the same code for grouped benefits, you'll need to make sure that each of the benefits grouped under the same code are pre- or post-tax. Otherwise, your payroll system may calculate taxes incorrectly for employees. Here's a list of commonly pre-tax benefits, and a list of commonly post-tax benefits.

While you’re free to name a deduction code anything you’d like, here are names that we typically recommend:

Benefit Type Deduction Code Name
Medical Insurance Medical Pre-Tax
Dental Insurance Dental Pre-Tax
Vision Insurance Vision Pre-Tax
Health Savings Account (HSA) HSA Pre-Tax
Flexible Savings Account (FSA) FSA Pre-Tax
401k 401k
Roth 401k Roth 401k
401k Employer Match 401k ER Match
Life Insurance Life Post-Tax
Long Term Disability (LTD) LTD Post-Tax
Short Term Disability (STD) STD Post-Tax
Transit Commuter Transit Pre-Tax
Transit Post-Tax
Parking Commuter Parking Pre-Tax
Parking Post-Tax
Cancer Insurance Cancer Insurance Post Tax
Accident Insurance Accident Insurance Post Tax
Critical Illness Insurance Critical Illness Insurance Post Tax
Hospital Indemnity Insurance Hospital Indemnity Insurance Post Tax

Please contact your tax advisor for advice on benefits taxability when setting up your deduction codes as pre-tax or post-tax.

Generally, you should create new deduction codes in the following situations:

  • An existing pre-tax deduction code was assigned to a benefit that should be post-tax.
  • An existing code is provider-administered, and Zenefits can't use it.
  • There are multiple codes in payroll for the same benefit, and Zenefits doesn't know which one to use.

A provider-administered deduction code is one that's defined and controlled by Paychex. Zenefits can't make changes to benefits that are assigned a provider-administered code. To ensure all changes get synced properly, create a new deduction code so that Zenefits can manage the relevant benefit line(s).

A “hooked” deduction code is one that's tied to ADP Benefits Integration, and is thus controlled by ADP. Zenefits can't make changes to a benefit that's assigned a hooked deduction code in ADP. To ensure all changes get synced properly, terminate that integration for any benefits that are actually managed by Zenefits.

In some cases (such as provider-administered codes in Paychex or "hooked" codes in ADP), you might need to create new ones specifically for Zenefits when mapping deduction codes in Zenefits, but there's no need to delete codes that are already in payroll. Zenefits just needs to know which codes to use.

However, for each employee who had previous deductions for the same type of benefit using an older code that is isn't mapped to Zenefits, make sure to either enter zeros for the unused code, or delete it from the employee (not the payroll account) entirely to prevent them from being overdeducted. Learn more about zeroing out deduction codes in payroll.

*Administrators must also zero out/remove any deductions right before terminating or right after rehiring an employee. This is to ensure that deductions assigned to the employee's terminated profile are not sent to the rehired one.

Zenefits treats individual deductions as either always pre-taxor always post-tax, based on how you've assigned it. However, benefits that would normally be pre-tax might actually be post-tax for certain types of individuals, such as S Corp owners, partners in a partnership or LLC, and CEOs.

  • S Corp administrators should follow these instructions to identify any shareholders who own 2% or more of the S Corp.
  • For all other types of corporate entities, administrators should identify their company owners and officers by logging in to Zenefits and clicking Tax Info from the Company Profile app. Then, contact Support to prevent the owners /officers' deductions from pushing to payroll.

When you're mapping deduction codes in payroll to Zenefits, make sure to zero out or remove older codes that are assigned to employees in payroll but not mapped to Zenefits. 

  • In Zenefits: In the Settings section of the Pay Connect app, zero out the deduction under your payroll provider column by picking Select from the drop down and clicking Save.

This way, employees aren't overdeducted or double-deducted. For any employees with two or more deduction codes for a single benefit in payroll:

  • In Gusto: just remove the unmapped benefit from the employee in Gusto, and keep the mapped code assigned to them. Gusto doesn't allow employees to have $0 for both employee deductions and employer contributions for the same benefit. However, removing the benefit from individual employees does not delete it from the company's Gusto account.
  • In Paychex: enter $0 for the existing deduction code that isn't mapped to Zenefits. Alternatively, the unused code can simply be removed from the employee.
  • In ADP Workforce: for employees with two or more deduction codes for the same benefit, simply inactivate the codes that aren't mapped to Zenefits for that benefit.

Learn more about why it's important to zero out older deduction codes in payroll.

Zenefits will not push changes to deductions in payroll that aren't mapped in Zenefits. When you're mapping deduction codes, if your employees have prior amounts in payroll for any deduction codes that aren't mapped to Zenefits, you'll need to either enter zeros ("zero out") for those codes, or delete the codes entirely from each employee. Otherwise, employees will continue to be deducted in payroll for those amounts.

For example, if you had two Medical codes (MDCL1 & MDCL2), and MDCL1 is mapped to Zenefits:

  • Each employee with Medical coverage through Zenefits should be assigned the MDCL1 code in payroll.
  • If any of these employees also had prior Medical deduction amounts under the MCDL2 code, those amounts should be changed to $0 in payroll for each employee, or the code itself should be removed from the employees.

See this page for instructions on how to zero out or remove unmapped codes in payroll.

Because deduction codes determine the way employees are taxed for their portion of their benefits, you cannot use the same deduction code for pre-tax and post-tax benefits.

For example, you can use the code Health for both Medical and Dental deductions, but you cannot use Retirement for both 401(k) and Roth 401(k), as these benefits are taken pre-tax and post-tax respectively.

Companies synced with Paychex will not be able to map their 401(k) employer contribution. You will receive an inbox task with more instructions if this applies to you. 

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