Many retirement and Health Savings Account (HSA) plans allow for ACH or direct deposits. With OnPay, individual contributions can be directly deposited into the employee's HSA account and/or retirement account.
Questions to ask your plan administrator
Before you begin, you'll need to ask your plan administrator three or four questions:
- Does your plan administrator accept ACH deposits from a third party payroll provider?
- What are each employee's routing and account numbers to which your HSA or retirement contributions need to be directed?
- Is there any specific information that your plan administrator requires in the memo field?
- If your retirement account is with Fidelity, Vanguard, or Charles Schwab, what are their ACH account numbers for your employees?
Why do I need ACH account numbers for Fidelity, Vanguard, or Charles Schwab?
For these providers, each employee will have an account number specifically for ACH deposits. This number is different from their retirement plan account number. Without this account number, we are unable to deposit funds into an employee’s account.
Getting started
Deductions can be added to employees in their profile. To view an employee's profile, click their avatar on your dashboard, or click their name in the Workers menu.
In the employee profile, click to edit Payroll Deductions.
Adding employee deductions
Click the (+) to add a deduction. Any deductions already set up for this employee are listed here, so you may need to scroll down.
Choose "401K" from the deductions list, and click Add. You'll now see the deduction's tile has been added to the list.
Click the tile's caret to enter the account details.
Enter the routing and account numbers provided to you by your plan administrator, then toggle the switch to "Active". The employee's name should appear in the memo field, but you can replace this text if required by your plan administrator.
IMPORTANT:
If your retirement account is with Fidelity, Vanguard, or Charles Schwab, each employee will have an account number that's just for ACH deposits. This number is different from their retirement plan account number. Without the proper account information, we will be unable to deposit funds into an employee’s account.
Include Company Match?
Turning on “Include Company Match” will allow your employer match to be included in the ACH deposit amount. Leave this off if the company match is to be submitted separately.
As you set up this deduction, your work is automatically saved, so when you're finished, you can close the employee profile and move on to your next task.
Single debit for all for retirement accounts
If your 401(k) provider wants to debit your bank account for the total amount of funds for all employees, still set up the 401(k) deduction for each employee, but don't activate ACH. 401(k) providers are never able to debit OnPay directly for any funds.
If you have additional questions about setting up this deduction, talk to your plan administrator before you begin.