Discussion:Non-taxable sick pay?
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Discussion Forum Index --> Tax Questions --> Non-taxable sick pay?
| 14 March 2007 | |
| For 2005 client received a W-2 for $5,228 of Third Party sick pay with a code J in box 12 wich indicates (Nontaxable sick pay)
Foe some dumb reason ProSeries says that return must be paper filed because client has some, Nontaxable sick pay. So, if the amount is nontaxable ... I see no reason to include it on the 2005 tax return, so we can e-file for 2005. Now here in 2006 client get a W-2 Box 12 with a J code, wonder if ProSeries has fixed the problem? I guess not because it add the non-taxable sick pay into the total for line 1. Oh, what is a person to do? | |
| 14 March 2007 | |
| Was it printed on perforated paper?
(sorry, had to ask and hope you laughed as much as I just did) Doug, I promise you will get the chance to laugh at me this October. just don't throw vegitables | |
| 19 September 2007 | |
| WELL ... the time has come ... the above mentioned T/P just received a CP2000 letting her know that the $5,228 was missing from the 2005 tax return. Do you think they failed to notice the Code J in box 12? | |
| 19 September 2007 | |
| Doug, you didn't do extra math to back out the 5,228 did you? | |
| 19 September 2007 | |
| As I laid in bed this morning trying to wake up from a good nights sleep ... it dawned on me that the proper way to have handled the issue would have been to include it in income and then back it out, NO, Kevinh5 I did not back it out. Sometime when a new situation comes up it is not handled properly. Guess this means a call to the Practitioner HOTLINE. | |
| 19 September 2007 | |
| 1040man - This does not "smell" right. Normally non taxable sick pay amount is shown in box 12. Box 1 of the w-1 should not include the non-taxable amount. I looked up the instructions for preparing W-2's and it says that code J is for sick pay paid by a third party and not includable in income "(and not shown in boxes 1, 3 and 5) because the employee contributed to the sick pay plan".
Sound's like either the w-2 was incorrectly prepared or perhaps you read it wrong. Was the $5,228 shown in box 1? | |
| 21 September 2007 | |
| Was the $5,228 shown in box 1? Yes, it was shown in box 1 of the W-2. Talked to the payer of the sick pay today and they said it was taxable and they are trying to get their vendor to stop putting the Code J in box 12 when it is all taxable. So now I have to tell the T/P that she now owes and additional $1,400 to the IRS and we will have to amend the state return. | |
| 21 September 2007 | |
| doug: suggestion, how do you know the 'payor of sick pay' (third party) is correct?
What type of sick pay and did the employee contribute? Did you get a 'sick pay statement from the third party? | |
Taxestaxes (talk|edits) said: | 28 January 2008 |
| I have a W2 where there is no code J, but a check in the box for third party sick pay; wages are in Box 1, 3, 5 but not in the state wages box nor was state tax withheld....(kentucky). the wages are taxable in ky? I have a call into employer to see why they didnt withhold state.....now individual owes state.....any other Ky people experience this? | |
| January 28, 2008 | |
| KY doesn't require them to withhold taxes from sick pay or worker comp, but it taxable just the same. | |
