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Access vital funding to help your business remain open, continue paying your employees, and recover from unplanned circumstances due to the COVID-19 pandemic.

Paychex has created an easy-to-use online tool that details the specific federal relief programs and refundable credits available through the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security Act (CARES). The tool includes helpful links to applications and a comparison chart of loan programs (Paycheck Protection Program and the Economic Injury Disaster Loan program) to help you address what would best meet the needs of your current circumstances.

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We recommend discussing these options with your accountant or trusted advisor to determine the best course of action to leverage the incentives available.

Paychex is actively working to help make the PPP loan application process simpler. If you’re a Paychex client, we’re creating a report and ensuring it reflects changes introduced April 2 by the federal government. To utilize the report, your business or your clients’ business must have run payroll with Paychex in 2019.

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Revisiting the Flexibility and Benefits of Same-Day ACH as Third Phase of Service is Implemented

Payroll
Article
03/27/2018
  • The third and final phase of same-day automated clearinghouse (ACH) implementation began on March 16, 2018.
  • There are many benefits for employers that use direct deposit to pay employees.
  • The third phase requires financial institutions to make credits received in a same-day ACH window available for withdrawal by 5 p.m. local time.

Businesses using the nation's automated clearinghouse (ACH) service to move money between bank accounts are reaping the benefits of same-day ACH to pay staff via direct deposit on the same day they initiate payroll.

NACHA, the Electronic Payments Association, developed a three-phase approach to assist financial institutions in implementing same-day ACH.

The first phase, which began September 23, 2016, made available credits of up to $25,000. Financial institutions receiving same-day credits were required to post them to the receivers' accounts by the end of their processing day. Phase two, which took effect September 15, 2017, made same-day ACH debits available.

The third phase, which took effect on March 16, 2018, requires financial institutions to make all eligible ACH credits ($25,000 and under, not international ACH transactions) received in a same-day ACH window available for withdrawal by 5 p.m. local time. Previously, they had to make funds available by the end of their processing day.

Prior to same-day ACH, automated clearinghouse payments were settled on the next business day. Employers paying wages through direct deposit would need to initiate the payments from their bank at least one banking day prior to the employees’ payroll check date. But with same-day ACH, employers can send direct deposit payments to their employees, and employees can receive these payments, on the payroll check date.

Benefits of same-day ACH

Same-day ACH is a boon to companies or individuals that rely on:

  • Same-day payrolls, because it supports the need to pay hourly workers, allowing flexibility for late and emergency payrolls and missed deadlines, and giving workers quicker access to their pay;
  • Business-to-business payments, enabling faster settlement of invoices, with remittance information;
  • Quicker bill payments using both ACH credits and debits, so consumers can pay bills on time and receive faster crediting for late payments; and
  • Account-to-account transfers, with faster crediting for consumers who move money among multiple accounts.

Same-day ACH offers many benefits for employers, including:

  • More accurate payrolls, ensuring that workers are paid the correct amount even if last-minute changes occur;
  • Functionality for virtually all types of ACH payments, including both credits and debits;
  • Freedom from the hassle and expense of cutting paper checks if the business runs late with payroll files;
  • Easier payment of final wages for terminated employees, since funds can be paid via direct deposit;
  • More accurate payment to hourly workers, allowing extra time to figure time worked; and
  • Quicker reversals of payment errors once debit transactions can be sent as same-day ACH transactions.

Employees with direct deposit often find that same-day ACH provides:

  • Freedom from the inconvenience of dealing with a paper check if the employer runs late with payroll and can't fulfill electronic deposit; and
  • Immediate access to final wages upon termination, since the employer can use direct deposit to finalize payment for departing workers.

Paychex will continue to monitor same-day ACH developments. Note that Paychex offers direct deposit via ACH, and can guide your business in adopting same-day processing.

 

A previous version of this article was published Nov. 8, 2016.

Laura Cottrell
Laura Cottrell is a compliance analyst at Paychex, She also serves as the chair of the American Payroll Association's (APA) Electronic Payments Committee.
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This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.