Give an Employee Advance - Loan to Employee


An employee advance is a no-interest loan from the business to an employee that will paid back on future paychecks. You can use Monchilla to give an employee an advance.

Note: Employee advances are not considered wages because they are really just loans. That is why they do not have to be taxed in any way when they are given to the employee or when the employee pays them back.

Give an Employee an Advance

  1. Under the Payroll tab, click Paychecks. On the Paychecks page, select the employee's paycheck where you want to include an advance and click Edit Item.

  2. Scroll to the bottom of the paycheck and click the Add/Remove Rule button towards the bottom right of the check.

  3. Check the Advance to Employee rule.

  4. Scroll to the bottom and click Save.

  5. Select Advance to Employee on the paycheck and click Edit Item.

  6. In the Value field, enter the advance amount. You do not need to edit any other fields. Click Save.

  7. In the Paycheck window, click Save.

You've successfully set up an advance for an employee. The net wage and gross wage are not affected, but the Payment to Employee now includes the employee advance. The Payment to Employee is the total amount that will be paid to the employee when you print a check or execute direct deposit.

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