Understanding retroactive payroll deductions
Understanding retroactive payroll deductions
Coverage for you or your dependent(s) may be effective retroactively depending on when you enroll within your eligibility window. If this is the case, and your benefits are effective on a date prior to the current pay period, you will incur retroactive deductions for those missed pay periods. These retroactive deductions will be taken on a post-tax basis* from your future paychecks, no more than two times the normal deduction amount, for the number of pay periods missed until the balance is paid off.
You may owe retroactive deductions if:
You are a new hire
You experience a qualifying life event (birth/adoption, marriage, etc.)
Dependent verification was in process and is now complete
*Certain events that will be deducted retroactively as pre-tax are new hire, rehire, and birth/adoption.
Example 1: New Hire enrolled in coverage three weeks after hire date
Hire Date: 3/10/2025
Benefits Effective: 3/10/2025
Enrolled date: 4/3/2025
Enrolled: Employee Only Coverage
Cost and Deduction Breakdown Table
| Check Date | Cost of Benefits per pay period | Actual deduction per pay period | ||||||
|---|---|---|---|---|---|---|---|---|
| Medical | Dental | Vision | Total Cost Per Pay | Medical | Dental | Vision | Total Deducted Per Pay | |
| 3/14/25 | $143.60 | $36.63 | $3.03 | $183.26 | - | - | - | $0 |
| 3/28/25 | $143.60 | $36.63 | $3.03 | $183.26 | - | - | - | $0 |
| 4/11/25 | $143.60 | $36.63 | $3.03 | $183.26 | $287.20 | $73.26 | $6.06 | $366.52 |
| 4/25/25 | $143.60 | $36.63 | $3.03 | $183.26 | $287.20 | $73.26 | $6.06 | $366.52 |
| 5/9/25 | $143.60 | $36.63 | $3.03 | $183.26 | $143.60 | $36.63 | $3.03 | $183.26 |
| Total | $916.30 | Total | $916.30 | |||||
Key Points:
4/11: The Employee Only cost is deducted twice to cover the current pay period plus the 3/14 check date.
4/25: The Employee Only cost is deducted twice to cover the current pay period plus the 3/28 check date.
5/9: The Employee Only cost is only deducted once because the payments are now caught up.
Example 2: New Hire enrolled in coverage and spouse and children need to be verified
Hire Date: 3/3/2025
Benefits Effective: 3/3/2025
Enrolled date: 3/3/2025
Enrolled: Employee + Family Coverage
Cost and Deduction Breakdown Table
| Check Date | Cost of Employee + Family Benefits per pay period | Actual Deduction per pay period | ||||||
|---|---|---|---|---|---|---|---|---|
| Medical | Dental | Vision | Total Cost Per Pay | Medical | Dental | Vision | Total Deducted Per Pay | |
| 3/14/25 | $142.02 | $20.28 | $10.35 | $172.65 | $81.15 | $11.60 | $6.47 | $99.22 |
| 3/28/25 | $142.02 | $20.28 | $10.35 | $172.65 | $202.89 | $28.96 | $14.23 | $246.08 |
| 4/11/25 | $142.02 | $20.28 | $10.35 | $172.65 | $142.02 | $20.28 | $10.35 | $172.65 |
| 4/25/25 | $142.02 | $20.28 | $10.35 | $172.65 | $142.02 | $20.28 | $10.35 | $172.65 |
| 5/9/25 | $142.02 | $20.28 | $10.35 | $172.65 | $142.02 | $20.28 | $10.35 | $172.65 |
| Total | $863.25 | Total | $863.25 | |||||
Key Points:
3/14: The Employee Only cost is deducted because the spouse and children have not yet been verified.
3/28: The spouse and children have now been verified, so the Employee + Family cost is deducted, plus the cost for the spouse and children for the prior pay period.
4/11: The Employee + Family cost is deducted because the payments are now caught up.
4/25: The Employee + Family cost is deducted.
5/9: The Employee + Family cost is deducted.
Need additional support?
Call the Iron Mountain Benefits Center at 877-907-4828, Monday through Friday, 8 a.m. – 9 p.m. ET.