As year-end approaches, there are several items you should be considering related to payroll and W-2 preparation.
Here’s what we need from you:
WHEN TO SUBMIT INFORMATION
Please submit your payroll information to your My Eide Bailly portal by Tuesday, January 10, 2023. Please include:
Upon completion, all forms will be mailed directly to the recipients and all government copies will be electronically filed with the appropriate authorities. We will upload the copies for your records to your My Eide Bailly portal.
Please note, all W2 forms must be furnished to recipients on or before January 31, 2023 to avoid penalties. We cannot guarantee timely filing for information received by us after January 25, 2023.
HOW TO SUBMIT INFORMATION
INFORMATION TO SUBMIT
The following illustrates the most common types of benefits paid to employees, which must be included in their income. Please review these items for additional taxable benefits and provide us with a list of the employees, the benefit received, and the benefit amount.
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:
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:
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:
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.
Make sure to provide us with the most current address and/or name change for all past and present employees.
If you don’t have a QuickBooks file and cannot send us a backup, we will need the following filled out on each tab: