When Is the Next Year With 27 Pay Periods?

Many employees paid every two weeks expect to receive 26 paychecks each year. However, the calendar sometimes aligns in a way that introduces a surprise for both employees and employers. In certain years, a bi-weekly pay schedule can result in 27 pay periods instead of the usual 26. This occurrence can impact personal budgeting and requires adjustments for payroll management.

Understanding the 27-Pay Period Phenomenon

A standard calendar year contains either 365 or 366 days. A bi-weekly pay cycle spans 14 days. Dividing the number of days in a year by 14 days per period reveals why an extra pay period occasionally arises. For instance, 365 days divided by 14 days per period equals approximately 26.07 pay periods, while 366 days divided by 14 days per period equals approximately 26.14 pay periods. These calculations show that a year does not contain exactly 26 full bi-weekly periods; the slight remainder accumulates over time.

An extra bi-weekly pay period occurs when the first payday of a calendar year falls very early in January, typically on January 1st, 2nd, or 3rd. The exact timing of this extra pay period depends entirely on a specific company’s established bi-weekly pay cycle start date. This mathematical alignment, rather than a change in pay frequency, is the root cause of the phenomenon.

Upcoming Years with 27 Pay Periods

The occurrence of 27 bi-weekly pay periods happens roughly every 11 years. The next year projected to have 27 bi-weekly pay periods for many companies is 2025. Following 2025, the next likely occurrences are around 2036 and 2047, maintaining this approximate 11-year cycle.

To determine if a specific company’s pay schedule will result in 27 pay periods, employees should check their payroll calendar for the first bi-weekly payday of the year. This early start date allows enough 14-day intervals to fit an additional payday before December 31st. For example, if a company’s pay cycle starts with a payday on Friday, January 3, 2025, and continues every two weeks, the 27th payday will fall within that calendar year. Companies can use payroll calendars provided by services like ADP to anticipate these years and plan accordingly.

Navigating the Extra Pay Period

The presence of an extra pay period carries implications for both employees and employers. Employees will receive an additional paycheck, which increases their gross income for that particular year. This extra income can affect personal budgeting and might lead to a slight under-withholding of federal income taxes if standard deductions and allowances are spread across only 26 periods. Employees may consider adjusting their W-4 form to increase withholding to avoid a larger tax liability or a smaller refund at tax time.

For employers, a 27-pay period year necessitates careful payroll adjustments and budgeting. The additional payroll expense for the extra pay period must be factored into the annual budget. Furthermore, managing deductions for benefits like 401(k) contributions or health insurance premiums, which are typically spread over 26 pay periods, requires attention. Some employers might adjust the per-pay-period deduction amount to ensure the full annual contribution or premium is collected over 27 periods.

Clear communication with employees is important to explain the impact of the extra pay period, especially regarding potential tax implications or adjustments to benefit deductions. For instance, an employee earning a $52,000 annual salary typically receives $2,000 per bi-weekly paycheck ($52,000 / 26 periods). In a 27-pay period year, if the employer does not adjust the per-paycheck amount, the employee would receive an additional $2,000, totaling $54,000 for the year. Some employers might elect to reduce the per-paycheck amount to maintain the annual salary, for example, dividing $52,000 by 27 periods, resulting in approximately $1,925.93 per check.