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Need help setting up taxable STD/LTD insurance premium in Payroll

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Community Explorer **

Need help setting up taxable STD/LTD insurance premium in Payroll

I have been trying in vain to set up a taxable STD/LTD insurance premium payroll item in Payroll.  I have chatted online twice and did not get anywhere.  Spent about 3 hours of time on it.  It works much like GTLI but the amount is not calculated.  I can get it entered as a payroll item but it is not taxing the amount that I am putting in.

 

I could use some help!

3 Comments
Community Manager

Re: Need help setting up taxable STD/LTD insurance premium in Payroll

Hello cfeltes,

 

We appreciate you coming here to get more help with tracking payroll items. 

 

If this is all about how to "report the taxable third party sick pay in QuickBooks Desktop and tax form", please follow the steps 1,2,3 in this article: Enter Taxable Third-Party Sick Pay (Disability).

 

Please let us know if you have more questions. 

 

 

Community Explorer **

Re: Need help setting up taxable STD/LTD insurance premium in Payroll

No it is not about third party sick pay at all.  We pay the 
STD and LTD insurance premium for our employees.  We want to set up the premium as a taxable item so that if they receive third party sick pay it is not taxable.

 

The premium amount should be taxed but not added to net pay.  I cannot find any way to get this set up in QuickBooks at all.  I keep getting redirected to setting up third party sick pay which is incorrect.

QuickBooks Team

Re: Need help setting up taxable STD/LTD insurance premium in Payroll

Hello cfeltes, and thanks for the clarification.


You’ll need two payroll items in this situation. First, you can set up the insurance as an addition item and choose the right tax tracking type for it. Second, you’ll want to set up an offset item where you put in the offsetting amount, so it doesn’t add to the net pay.


Set up the insurance item:

  1. From the List menu, choose Payroll Item List.
  2. Right click anywhere and choose New.
  3. Choose EZ Setup and click Next.
  4. Choose Other Additions and click Next.
  5. Choose Miscellaneous Addition and click Finish.
  6. Edit the item and rename it as STD or LTD, or depending on your choice.
  7. Click Next until you see the Tax tacking type window.
  8. Choose the right type for the item. You can ask to your accountant about this.
  9. Click Next and click Finish on the last window.

When you set up the offset item, just follow the steps above, then make sure its Tax tracking type is set to None.

 

When you add the items on the paycheck, you’ll want to enter a positive amount for the insurance item and a negative amount on the offsetting item. The amounts have to be the same.

 

Please get back to us if you have additional questions. Thanks!