This is to track Third Party Sick Pay in your Chart of Accounts.

1. Select the Lists drop-down, choose Chart of Accounts.
2. Select Account, and New.
3. Select Expense and Continue.
4. Enter the name of the new Expense account (something like, Taxable Third Party Sick Pay) in the Account Name field.
5. Select Save & Close.

What box does third party sick pay on a W-2?

Generally, a taxpayer must report as income any amount that the taxpayer receives for personal injury or sickness through an accident or health or insurance plan that is paid for by their employer. Third party sick pay reported in Box 1 of the W-2 is considered taxable income and should be reported as such.

How do I claim third party sick pay?

How to Report Third-Party Sick Pay to the IRS

1. Step 1: Identify Whether Sick Pay Is Paid Under a Plan.
2. Step 2: Identify the Entity That Pays the Sick Pay.
3. Step 3: Apportion the Tax Responsibilities.
4. Step 4: Decide Whether to File Form 8922.
5. Step 5: Complete Form 8922.
6. Additional Resources.

Where to enter third party sick pay in QuickBooks?

You can enter non-taxable third-party sick pay on a payroll check in QuickBooks Desktop. This enables you to track third-party sick pay on paychecks and properly report these payments on the correct tax forms. If you have received the third-party sick pay amounts from your provider, you can enter the pay on a payroll check.

Who is eligible for third party sick pay?

Employees who lose wages as a result of illness or a nonwork-related accident are eligible to receive disability payments, also known as third-party sick pay. This coverage is typically part of an employee’s benefits package as a way for employees who get sick, injured, or are temporarily disabled to receive compensation while out of work.

How to determine if sick pay is subject to tax?

Determine if payroll features such as third-party sick pay and group term life insurance are subject to tax. Responding to employee W-2 inquiries is much easier once you know the pay elements used to determine the taxable wages on the W-2. Review the federal record-keeping requirements for all non-agricultural employees.

What is box 14 on Form W-3 for sick pay?

The Box 14 is for the income tax withheld by payer of third-party sick pay. You have to complete this box only if you are the employer and have employees who had federal income tax withheld on third-party payments of sick pay. You’ll only have to report the FIT and not the total amount withheld by the third-party company.