Set Up State Disability & Unemployment Withholdings for HSA Deductions & Contributions

Some states require employer contributions to Health Savings Accounts (HSA) to be subject to State Disability Insurance (SDI) and State Unemployment Insurance (SUI) taxes.

Note: The HSA deduction must be set up before setting up the deductions for state disability and unemployment because of encumbrances during the enabling of the deductions.

Make employer contributions to HSAs subject to state disability taxes

1. In Payroll Configuration, set Withhold State Disability on HSA Contribution to Yes.

2. In Manage Deductions, on the SDI deduction in the Primary Deduction Information section, select State Disability Deduction from the HSA Support pull-down list.

3. Click Save.

Make employer contributions to HSAs subject to state unemployment taxes

1. In Payroll Configuration, set Withhold State Unemployment on HSA Contribution to Yes.

2. In Manage Deductions, on the SUI deduction in the Primary Deduction Information section, select State Unemployment Deduction from the HSA Support pull-down list.

3. Click Save.

Return to HSA Deductions and Withholdings

Return to Manage Deductions Overview