# What is bi monthly payroll

## What is a bimonthly payroll?

The term "bimonthly" means that something occurs once every two months. Therefore, a bimonthly payroll means paying employees once every two months. Since this is not only illegal in many locations, but also an oppressively long pay period, a bimonthly payroll is extremely not recommended! In many locations, the longest allowed payroll period is one month. In the rare situation where a business is actually using a bimonthly payroll, the calculation of pay for each payroll cycle is to divide annual pay by six. Thus, a person earning $120,000 per year will be paid $20,000 in gross wages in each bimonthly payroll.

It is possible that the term "bimonthly" is being confused with the terms semi-monthly or bi-weekly. Their definitions are:

*Bi-weekly payroll*. This payroll is paid every other week, usually on a Friday. Under this system, there are 26 payrollsper year.

*Semi-monthly payroll*. This payroll is paid twice a month, usually on the 15th and last days of the month. Under this system, there aer 24 payrolls per year.

Thus, a bimonthly payroll is very likely a term that is being incorrectly used, where the user really means either a bi-weekly payroll or a semi-monthly payroll.

If there is a choice between implementing a bi-weekly or a semi-monthly payroll, the best practice from an efficiency perspective is to use a semi-monthly payroll, since there are two fewer payrolls to prepare per year. In addition, it is easier to calculate monthly payroll deductions under a semi-monthly system, since there are always two payrolls per month; conversely, there are two months per year in which there are three *bi-weekly* payrolls, which makes it difficult to handle deductions in the third payroll of the month.

**Related Topics**

Source: www.accountingtools.com

Category: Bank