Year-End W-2 Compliance

Yes - The value of an employee’s personal use of a company owned, or leased vehicle must be included in wages on the employee’s W-2. If this applies, please fill out the information on the worksheet on the tab personal use of auto worksheet.

Yes - In most instances, the employer or third-party agent must report third party sick pay on an employee’s W-2. If you have not already provided us with third party sick pay statements for employees receiving it, please do so now.

Yes – If employer pays disability insurance premiums and includes them in the employee’s W-2 wages, normally, any disability benefits paid to the employee are exempt from income taxes. If the premiums were not included in the employee’s wages, any disability benefits received are taxable to the employee.

Yes - The value of employer paid group term life insurance in excess of $50,000 of coverage generally must be included in employees’ W-2 wages. Unless the employee is a 2% shareholder then they are taxed on the premium amount. They do not get to exclude the $50,000.

In order to calculate the amount includible in income we will need the following:

• The total amount of coverage,
• The employee’s age as of the end of the year, and
• The amount of any employee premium payments made with after tax dollars.

Yes - Any amount paid to employees in the form of non-job-related educational assistance in excess of $5,250 must be included in their W-2 wages.

Yes – the amount must be recorded in box 10. Max benefit is $5,000 if any benefits paid in excess of $5,000 it must be included in the employee’s taxable income.

Yes -The following types of payments made for S-Corporation employees are includible in the employee’s taxable income if the employee is a greater than 2% shareholder: this includes spouse, children, parents and grandparents of a more than 2% shareholders. Please provide list of employees who are 2% Shareholders and the following:

• Medical insurance premiums
• Disability insurance premiums
• Medical expense reimbursements
• Health Savings Account contributions

Did the Employer contribute to HSA
Yes – provide a list of employees and the employer amount of contribution

Did the employee contribute to HSA
Yes - please provide a listing of employees contributing pre-tax dollars to their HSA and the amount

Yes – Please provide the following:

• What type of plan (401K, 401K Roth, Simple, PERA)
• List of employees that employer did contributions for

Yes – These items are taxable to your employees, if you did not already include in taxable wages provide list of employees and the amounts.

You may have an annual Affordable Care Act reporting responsibility to the IRS and your employees
The Affordable Care Act (ACA) requires applicable large employers (ALEs)—companies that during the prior year had 50 or more full-time employees or the equivalent when part-time employee hours are combined—to submit reporting forms to the IRS and to distribute these forms to employees (Form 1095-C). Organizations with less than this threshold but part of a group of businesses (e.g., parent-subsidiary, common control, etc.) with 50 or more full-time employees when combined, could be considered an ALE and have a reporting responsibility. Additionally, organizations that sponsor self-insured health coverage, regardless of the employee headcount, may be required to provide reporting under the ACA.

Companies with a reporting responsibility who do not file timely, accurate forms may be subject to IRS penalties. Organizations that file, but do not meet certain health coverage requirements under the ACA may also be subject to IRS penalties. There is no statute of limitations on the ACA forms, so keep all forms and supporting documentation indefinitely. Talk to your Eide Bailly professional if you have questions about ACA reporting requirements or penalties.

Yes – you are required to supply both employee and employer portion of health on the W2 in Box 12 code DD.