How do you add last year's health insurance premiums for s-corp?

OdieW · ‎January 17, 2023

Hello,

I just recently found out that I could have had my s-corp reimburse for my health insurance premiums thru my payroll. How do I get the insurance premiums reimbursed to me? Just write a check? Or do I need to do unscheduled payroll but for 2022?? Is that even possible?
I just need to somehow get the insurance premiums onto my W2 for 2022.

Any advice would be appreciated.

ReymondO · ‎January 17, 2023

Good day, @OdieW.

You can run an unscheduled payroll to reflect the insurance premium on your W2 for 2022. Here's how:

Go to the Employees menu and select Pay Employees.
Choose Unscheduled Payroll from the check types.
Verify the Pay Period Ends date, Check Date, and QuickBooks Bank Account.
Select the employees you want to pay.
You can enter hours using the grid, or to see everyone's paycheck details, click Open Paycheck Detail.
Select Save & Next to go to the next employee, or select Save & Close to go back to the Enter Payroll Information window.
Click Continue.
Review the Check/Direct Deposit printing options.
Verify the amounts for each employee, and select Create Paychecks.

For more info, you can check out this article: Create and run your payroll.

Moreover, you can check out this article for more insights on how QuickBooks populates W2 and supported pay types and deductions impacts federal taxes and forms: W2 form boxes explained

You’re always welcome to visit the Community if you have any questions about t S-Corp Owners Health Insurance in QuickBooks. Please know I’ll be right here to make sure you're taken care of.

View solution in original post

LieraMarie_A · ‎January 18, 2023

Hi there, @OdieW. I've got the steps you need to set up the S-Corp Pd Med Premium item in QuickBooks Desktop.

You need a company contribution payroll item to track the medical insurance. Follow the steps below to create this item:

Select Lists, then Payroll Item List.
Select the Payroll Item ▼ dropdown, then New.
Select Custom Setup, then Next.
Select Company Contribution, then Next.
Enter the name of the item, then Next.
Select the name of the agency (or add it) and the account number.
- In the Liability account field, select the account you’ll use to track company contributions. And in the Expense account dropdown, select the expense account that you want to track the item. Select Next.
In the Tax Tracking Type window:
- Select S-Corp Pd Med Premium for the 2% shareholder that has the same medical insurance plan to all employees.
- Select Fringe Benefits if the 2% shareholders have a different plan from other employees or don't offer the plan to employees at all.
Select Next three times, then Finish.

Then, assign this item to your profile. Here's how:

Select Employees, then Employee Center.
Double-click your name.
Select Payroll Info.
In the section for Additions, Deductions, and Company Contributions, under Item Name, add your S-Corp payroll item.
In the Amount column, enter the amount per paycheck to take out. In the limit field, enter the total premiums for the whole year.
Click OK.

Once done, run your payroll with an S-Corp medical insurance item on it. You can pay 12 months of premiums at once, However, keep in mind that the premium payments are considered business expense. The IRS may require you to pay them on a monthly basis. I recommend consulting with your tax advisor to ensure this aligns with the tax rules of your specific state. If you don't have one, visit the ProAdvisor site to run a search.

Finally, if you need to track your contributions, pull up payroll reports in QBDT Payroll.

Feel free to visit the Community again if you need more help with running payroll. We're always here to help. Have a great day ahead!

View solution in original post

ReymondO · ‎January 17, 2023

Good day, @OdieW.

You can run an unscheduled payroll to reflect the insurance premium on your W2 for 2022. Here's how:

Go to the Employees menu and select Pay Employees.
Choose Unscheduled Payroll from the check types.
Verify the Pay Period Ends date, Check Date, and QuickBooks Bank Account.
Select the employees you want to pay.
You can enter hours using the grid, or to see everyone's paycheck details, click Open Paycheck Detail.
Select Save & Next to go to the next employee, or select Save & Close to go back to the Enter Payroll Information window.
Click Continue.
Review the Check/Direct Deposit printing options.
Verify the amounts for each employee, and select Create Paychecks.

For more info, you can check out this article: Create and run your payroll.

Moreover, you can check out this article for more insights on how QuickBooks populates W2 and supported pay types and deductions impacts federal taxes and forms: W2 form boxes explained

You’re always welcome to visit the Community if you have any questions about t S-Corp Owners Health Insurance in QuickBooks. Please know I’ll be right here to make sure you're taken care of.

OdieW · ‎January 18, 2023

@ReymondO

Sorry, I think I jumped ahead of myself with my initial question. How to I set up the S-Corp medical premium on Quickbook Desktop? I have not done that yet and not sure how to do it. I am a single member S-Corp

Also, can I pay 12 months of Medical Premium at once? I didn't know I could have the medical premiums paid thru my S-Corp until recently.

LieraMarie_A · ‎January 18, 2023

Hi there, @OdieW. I've got the steps you need to set up the S-Corp Pd Med Premium item in QuickBooks Desktop.

You need a company contribution payroll item to track the medical insurance. Follow the steps below to create this item:

Select Lists, then Payroll Item List.
Select the Payroll Item ▼ dropdown, then New.
Select Custom Setup, then Next.
Select Company Contribution, then Next.
Enter the name of the item, then Next.
Select the name of the agency (or add it) and the account number.
- In the Liability account field, select the account you’ll use to track company contributions. And in the Expense account dropdown, select the expense account that you want to track the item. Select Next.
In the Tax Tracking Type window:
- Select S-Corp Pd Med Premium for the 2% shareholder that has the same medical insurance plan to all employees.
- Select Fringe Benefits if the 2% shareholders have a different plan from other employees or don't offer the plan to employees at all.
Select Next three times, then Finish.

Then, assign this item to your profile. Here's how:

Select Employees, then Employee Center.
Double-click your name.
Select Payroll Info.
In the section for Additions, Deductions, and Company Contributions, under Item Name, add your S-Corp payroll item.
In the Amount column, enter the amount per paycheck to take out. In the limit field, enter the total premiums for the whole year.
Click OK.

Once done, run your payroll with an S-Corp medical insurance item on it. You can pay 12 months of premiums at once, However, keep in mind that the premium payments are considered business expense. The IRS may require you to pay them on a monthly basis. I recommend consulting with your tax advisor to ensure this aligns with the tax rules of your specific state. If you don't have one, visit the ProAdvisor site to run a search.

Finally, if you need to track your contributions, pull up payroll reports in QBDT Payroll.

Feel free to visit the Community again if you need more help with running payroll. We're always here to help. Have a great day ahead!

OdieW · ‎January 19, 2023

@LieraMarie_A

Thank you for the info.

If I were to pay all 12 months on 1 unscheduled payroll check, could I later use journal entries to distribute the 12 months to the individual months?

katherinejoyceO · ‎January 19, 2023

Thanks for coming back, @OdieW. Yes, you may also use the journal entry to enter the 12 months on unscheduled payroll checks.

Here's how:

From your Company menu, select Make General Journal Entries.
Enter all the necessary details in the fields to create your journal entry. Make sure your debits equal your credits when you’re done.
Select Save or Save & Close.

To ensure your transactions are properly recorded, I'd recommend consulting an accountant.

Feel free to post some more of your questions if you have any. We're here to assist you again.

OdieW · ‎January 19, 2023

@katherinejoyceO

Thanks for the reply.

Yes I will be consulting an accountant to make sure I do this correct. But I'm thinking writing 12 checks maybe easier 🤷

RGFram · ‎January 26, 2023

So, my boss (the 2%+ Shareholder) does not on any level want me to run the reimbursement through payroll, as he says that defeats the purpose of "the benefit". His account has stated that I just simply need to add it to box one and box 14 on the W-2 at the end of the year showing the lump sum. They (boss and his wife) have taken it upon themselves to set up the premium moving forward as an auto deduction for the company checking account. I have to issue a check made payable to him for last year's premium. How on earth do I modify the w-2 at the end of the year? Is there not going to be penalties on the business for underreporting?

I have spent enough hours on this and I am back at my starting point. I have set it up as a "fringe benefit" only federally taxed. It changed his paycheck by $25.00 and now he's pissed at me for not doing what I was told, as opposed to doing what I KNOW to be the correct way.....

DivinaMercy_N · ‎January 26, 2023

Hi there, @RGFram. I'm here to ensure you'll be able to modify the W-2 form in QuickBooks Desktop (QBDT).

In QuickBooks, modifying W-2 forms depends if you have already filed it or you haven't yet. To get started, refer to these steps below:

Before you file W-2

You just need to fix the issue in your product.
File your W-2 forms as you normally would.

After you file W-2

Navigate to the Employees tab and select Payroll Center.
Next, click the File Forms tab.
Choose Annual Form W-2c/W-3c - corrected Wage and Tax Statement, then Create Form.
Then, select the employee’s last name and select OK.
Pick the employee(s) who need a W-2c and select Review/Edit.
From there, answer the question: Have you made the W-2 corrections in QuickBooks Desktop?
If Yes, enter the Previously Reported amount for the items that should be corrected. If No, review each W-2c worksheet and enter the correct amounts in the Correct Information column.
Then, review each page and select Next as needed.
Check the box Check if this is a W-2c (corrected W-2).
Fill in only the lines that need to be fixed in both the Previously Reported and Correct Information columns. Do this on Federal, State and local info as needed.
Remove the amounts from the remaining lines. Right-click on the amounts and select Override, then delete the amounts. Do this on Federal, State and local info as needed.

For reference, please read this article: Fix an incorrect W-2 and W-3.

Then, for your other question, you'll get tax penalties if you don’t file on time, failure to pay proper estimated tax, dishonored check, etc. For more details, check out this article: Guide to IRS Tax Penalties.

I've also added this helpful resource that you can access to gather additional information about reporting W-2: Get answers to your W-2 questions.

I'm always here ready to lend a hand if you have any other concerns about processing W2 in QBDT. Don't hesitate to post again here. Have a great day ahead.

RGFram · ‎January 26, 2023

I have assisted payroll and I do not have the option for modifying a W-2 - it comes to me in pdf format and I only have the option to print on the w-2 paper I ordered or save it as a pdf file. Now, I know I can modify a pdf with my adobe software, but that doesn't fix the information in QuickBooks does it? I am also speaking in future tense....this is happening for 2023 payroll and the reimbursement for 2022 insurance was done after the new year. So, I am trying to get it set up correctly for 2023 payroll records and w-2 reporting.

MorganB · ‎January 26, 2023

Hi there, RGFram.

Thanks for joining this thread. I want to make sure you're able to get everything set up correctly for payroll records and W-2 reporting.

In this instance, I recommend reaching out to a member of the QuickBooks Desktop Payroll Support Team. Agents have specialized tools, like the ability to share you screen, that will enable them to work alongside you to ensure everything is entered correctly. Additionally, they'll be able to view your details on the back end to verify the entries one step further. Here's how to get in touch with the team:

1. With QuickBooks open, go to Help, then select QuickBooks Desktop Help/Contact Us.
2. Select Contact Us.
3. Enter a brief description of your issue, then choose Continue.
4. Sign in to your Intuit account and select Continue and then Continue with my account.
5. You'll be emailed a single use code. Enter your code and select Continue.
6. Select to chat with us or have us call you.

The following article provides these steps if you ever need them again in the future: Contact Payroll Support

Please feel free to reach back out if you happen to have any other questions or concerns.

RGFram · ‎January 26, 2023

I will try that, thanks!

MorganB · ‎January 26, 2023

You're welcome, RGFram.

The Community is always here if you need additional assistance. Take care!

OdieW · ‎January 26, 2023

Hello @RGFram , Just curious why did you set up the health premium as a fringe benefit? Wouldn't that make the premiums 100% taxable? Wouldn't it be better to set up as a S-Corp Pd Med Prem to avoid the FICA and FUTA taxes (at least you are not paying all the taxes)?

I'm in the same boat as you. I need to reimburse my boss last year's health premiums and add it premiums to the W-2. Going forward this year, it a debate whether to run the premiums thru payroll and just reimburse directly to my boss. It's so confusing

RGFram · ‎January 27, 2023

They are essentially one in the same and I was able to uncheck all tax line items except Federal. Which is what seems to be causing the grief with my boss. I initially selected the "fringe benefit" as that is how it is referred by IRS. I did not see the other tax tracking item until later and it will not let me change the tax tracking type now.

But either way - no difference in the tax liability.

BethFrisco · ‎January 05, 2024

This does not work. There is no unscheduled payroll option.

ShaniamarieC · ‎January 05, 2024

Allow me to dive into this thread to assist you, @BethFrisco. I’ll provide you with the details about the no unscheduled payroll option in QuickBooks Desktop (QBDT).

I understand how important for you to be able to work on your business smoothly with QuickBooks. I'll assist you with your questions and provide some clarification. To begin, I'd like to confirm what QuickBooks product you are using since this thread is intended for QuickBooks Desktop subscription. Moreover, can you please provide a further explanation as to what problem you encountered during the process? This enables us to investigate it further and provide a solution.

Your cooperation is greatly appreciated as it will provide us with a solution. If you provide a screenshot, please be mindful and careful to not include sensitive information. This precaution is taken to prevent any potentially scheming activities. I'll be waiting for your response. Keep Safe!

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How do you add last year's health insurance premiums for s-corp?