If my former employer mistakenly deposited money into my bank account, doI have to repay more than what was deposited?

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If my former employer mistakenly deposited money into my bank account, doI have to repay more than what was deposited?

I left my old employment 4 months ago and last week it made an error and direct deposited close to $600 to my account. Now it is requesting that I repay it $992. I am assuming this is the gross amount before taxes and maybe child support. I am returning the $600 that was deposited, however I fail to see how I responsible for any amount above that. I am already paying for child support so any amount deducted from their error would not give me a credit in the state where I am paying support.

Asked on March 13, 2012 under Employment Labor Law, North Carolina

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

An overpayment does not entitle you to keep the money mistakenly paid to you, so your employer can require you to repay it--and sue you, if you do not voluntarily do so. Moreover, it can recover from you not just the net amount you received, but also any amounts paid on your behalf--e.g. taxes, child support; that is, it can recover the gross amount. You in turn could seek either recovery of or a credit for these overpayments from the entities or person to whom they were directed. For example and to oversimplify: say that your child support obligation is $18,000 per year; if extra was paid now, due to an error, you should either be able to skip a payment later, have later payments reduced, etc. to reflect the early payment of some of your obligation. The same goes for taxes--if you overwitheld due to an overpayment, that should be taken into account while calculating your total tax liabilty for the year.


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