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3rd Party Sick Pay
If there are employees who received sick pay in the calendar year from an insurance company or other third-party payer, and the third party notified you of the amount of sick pay involved, you may be required to report it on the W2. Please refer to the IRS guidelines on how to handle third party sick pay.
If you have not processed your last payroll:
A Payroll Adjustment (PADJ) will need to be entered. On the Payroll Adjustment screen, select the employee number, enter 0 for the check number and the date of the check run the PADJ will be included. The PADJ box will automatically be checked.
Enter the amounts received from the third-party in the appropriate boxes. When this adjustment is included with payroll, the YTD and Quarterly numbers will be affected but not the current payroll. The payroll journal entry will need to be modified as the amount of the PADJ should not debit payroll (997000-50000) and credit cash for this recognized amount.
W2 Box 12 codes - There are numerous codes available for Box 12 of the W2. Please refer to the W2 instructions on the IRS website for specific uses of these codes. Use the Edit/Prepare W2s tab to enter box 12 information, if needed.
If you have already processed your last payroll:
A Payroll Adjustment (PADJ) will need to be entered. On the Payroll Adjustment screen, select the employee number, enter 0 for the check number and the date of 12/31/xx. The PADJ box will automatically be checked.
Enter the amounts received from the third-party in the appropriate boxes. Prepare payroll with just the PADJ and no timesheet batch. After reviewing the payroll register, go to Print checks. A message will appear stating there are no checks and ask if you would like to save the check run, answer Yes.
W2 Box 12 codes - There are numerous codes available for Box 12 of the W2. Please refer to the W2 instructions on the IRS website for specific uses of these codes. Use the Edit/Prepare W2s tab to enter box 12 information, if needed.
This must be done before the Save/Clear step on the Annual menu is done. If this step HAS been done, click on the Edit/Prepare W2 tab, select the employee and edit the information into the W2.
If you have not processed your last payroll:
A Payroll Adjustment (PADJ) will need to be entered. On the Payroll Adjustment screen, select the employee number, enter 0 for the check number and the date of the check run the PADJ will be included. The PADJ box will automatically be checked.
Enter the amounts received from the third-party in the appropriate boxes. When this adjustment is included with payroll, the YTD and Quarterly numbers will be affected but not the current payroll. The payroll journal entry will need to be modified as the amount of the PADJ should not debit payroll (997000-50000) and credit cash for this recognized amount.
W2 Box 12 codes - There are numerous codes available for Box 12 of the W2. Please refer to the W2 instructions on the IRS website for specific uses of these codes. Use the Edit/Prepare W2s tab to enter box 12 information, if needed.
If you have already processed your last payroll:
A Payroll Adjustment (PADJ) will need to be entered. On the Payroll Adjustment screen, select the employee number, enter 0 for the check number and the date of 12/31/xx. The PADJ box will automatically be checked.
Enter the amounts received from the third-party in the appropriate boxes. Prepare payroll with just the PADJ and no timesheet batch. After reviewing the payroll register, go to Print checks. A message will appear stating there are no checks and ask if you would like to save the check run, answer Yes.
W2 Box 12 codes - There are numerous codes available for Box 12 of the W2. Please refer to the W2 instructions on the IRS website for specific uses of these codes. Use the Edit/Prepare W2s tab to enter box 12 information, if needed.
This must be done before the Save/Clear step on the Annual menu is done. If this step HAS been done, click on the Edit/Prepare W2 tab, select the employee and edit the information into the W2.
