When PTO is paid out during a exit from a company, do they take pre-tax deductions for insurance and dental etc? It has already taken from that months salary. Why is it being taken twice?

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Because you can think of PTO paid as being “extra days worked,” from which those deductions have not been taken yet.

Basically, let’s say you have one month of PTO being paid out. They’re basically paying you as if you did one more month of work, from which the normal deductions and taxes would be taken.

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Woops sorry I read this too quickly and didn’t parse the insurance part. Thought it was about taxes and SS, etc.

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I wouldn’t expect deductions for employee elected insurance benefits unless you’re actually getting more coverage. You pay for employee benefits as fixed dollar amounts based on time you’re covered, not as a percentage of dollars earned.

However you will pay taxes on the vacation payout because taxes are assessed on dollars of income, and those are dollars of income.

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Very clear. Insurance & 401 k taken as per-tax deductions. I never check my paystubs. I don’t know what else I have missed. I am contacting payroll.

401k - depends on whether your plan considers PTO payout to be eligible wages; some do and some don't

Medical, dental, etc - probably shouldn't come out if they are already coming out on a schedule and this is an off-cycle check. But this happens all the time - payroll system just automatically adds them or the payroll team is manually running the check and doesn't think about the fact that the deductions don't make sense. Contact payroll to confirm. They can always reverse the check and rerun it or issue you a refund and clean up the deductions on their side separately.

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