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Level 3

Short Term Disability, Taxes and W2

I come to you again my fellow community members.  Dealing with things that I have not dealt with before in my own businesses cause I don't have employees, but since last year having been helping with payroll and such for my dad's business and then his passing in December making me and my 2 siblings owner of his business, I am learning lots of new things.


Let me start off with saying that we have already generated efiled and sent out the W2's for the employees.


Today in the mail, we get a notice for two employees that were on short-term disability this past year.  Each notice shows the employee's name, how much there payment was net before taxes, shows that they disability insurance company withheld FICA SS and FICA Med taxes and then their gross check they received.  Then shows taxable wages for Income/SS/Med-FU.


In the notice sent to us, it states The employer is responsible for applicable Employers matching portion of FICA, FUTA and SUTA (though we don't do SUTA since we are in Texas).  So I now assume that we have to somehow create something so we can account for our portion of the taxes and submit it, I guess with a 941.  


I also need to figure out how to generate a second W2 (since the originals are already done) to account for the disability payments and such, since the insurance company is not going it for us, according to this statement.  On the statements, one employee shows to have only received one check during his entire time out and the other employee shows that she received 4 checks while out.  


Need the best information I can get on how to take care of this in Quickbooks, make sure to get it to the IRS and generate these second W2's for these two individuals.  Guess it was my bad not waiting until the last minute to go my W2's

Thanks in advance.

4 Comments 4

Short Term Disability, Taxes and W2

Hello, @cdhodgdon.


We're saddened to hear about your loss. Please know that it is our goal to help you accomplish what you need to do in QuickBooks.


Regarding the details you shared with us, I want to know if you already have filed your 941 and all the W-2s in QuickBooks? I'm trying to assess if you want to send a correction form to the IRS and SSA for those forms. 


If you already filed your forms, and you need adjustments in the system, you may contact our support team to help with the corrections. You can request for a viewing session and one of our agents can review your taxes and make sure it gets reported correctly. 


To contact us, follow the steps below:


  1. On your QuickBooks company file, click the Help menu.
  2. Tap the QuickBooks Desktop Help option.
  3. Press Contact us on the pop-up box.
  4. Click on the Search for Something else button then type your concern in the Ask us anything box.
  5. Hit Search, then scroll down to get your contact options.


I'm also adding this article about our contact options and support availability for your reference: Contact QuickBooks Desktop support


Once the adjustments are done, you can now access the correct data on the forms. Follow the steps below:


  1. Go to the Employees menu and select Payroll Tax Forms & W-2s.
  2. Head to the Process Payroll Forms tab.
  3. Under File Forms, pick the form you want to use.
  4. Press Create Form.
  5. Make sure to add the correct period in the Select Filing Period field, then press OK.
  6. Refer to the IRS instructions for line-by-line assistance with the form.
  7. Don't forget to use the Check for Errors button to resolve any discrepancies or missing information on the form.
  8. Once everything is correct, click Submit Form.
  9. You can use Print and mail if you wish to send it manually to the IRS, or use the E-file button for electronic filing.


See this link for your reference to print, save, and email copies of filed tax forms using Adobe Reader.


If you need further help with the tax form processing, just message me again. I'll be right here to help you further. Have a good one!

Level 3

Short Term Disability, Taxes and W2

Sorry for the delay in reply @Jen_D been dealing with lots of items since my dad's passing.


When I submitted this information to the page here, I had already completed and sent in the W2's and reports for this past year.  Wanted to have them done and out by January 31.  Again not having employees in my own personal business, this is not something I have messed with.  Was so excited to have them done and gone, unlike the year before, when the secretary was attempting to do them and got us several weeks behind in getting them out.


So I had already submitted the W2's, W3 (or whatever) to the IRS via Quickbooks.  Then on January 25 or 26th, I got the notice from United Health that handles our short-term disability.  The report (notice) shows how much each of the two employees was paid through the short-term disability and how much United Health took out to cover the employee's portion of their taxes.  


Now, I have several issues.  First, I need to somehow account for the amounts paid via short-term disability (from United Health) in Quickbooks, so that it shows up on their W2 (which will not have to be corrected) and we can account for and pay the companies portion of their taxes.   


So I guess the first thing I need to know is how to add or account for this disability payment in their QB records, or how do we deal with it, so as stated above it shows up on their W2 and their taxes are taken care of?  How would this be handled on a 941 or whatever we need to use to report the taxes and make our payment to the IRS, especially if we are only paying the companies portion?


Then I need to make sure to send the IRS the corrected information for these two employees so that all the records match correctly and the proper funds are paid and accounted for.


I need to know how to account for these payments first, then know how to correct and send the corrected documents to the IRS/SSA.


Level 3

Short Term Disability, Taxes and W2



Ok, I followed some steps I found in Track Submit Taxable Third Party Sick Pay, which I really hope was the right way to do it.  So I got the information into QB correctly, I think.  What I am now trying to figure out, is I know I need to deal with SS Fica and Medcare FICA, but I also see the Federal Withholding when I look at the report.  So I assume that needs to be included as well.  How do I make sure that I am not wrong on that matter?


The company requires the employee to pay 100% of their Short Term Disability premium on a pre-tax basis, which means taxes are due on 100% of the payments, but I am not sure if that includes the normal Federal Withholding or just the FICA (SS and Medicare) taxes.  


Would it be better to generate a separate W2 just for the disability payments, or run a Corrected W2 for them?  How do I run a corrected W2 for them?  Do I need to submit a new 941 just for the two zero dollar checks I used to add the amounts to their reportable income (created using the info from the link above)?  How do I correct my end of the year 940 for all this as well?


Thanks in advance.


QuickBooks Team

Short Term Disability, Taxes and W2

Thank you for following the instructions given by my colleague, @cdhodgdon. Let me share some details about the forms that need to be amended.


You need to file a W-2c form to fix incorrect W2. The steps of filing a W-2c form depend on your payroll service. If your subscription is QuickBooks Desktop (QBDT) Payroll Assisted, you can contact us to request a correction.


However, if your subscription is either QBDT Payroll Enhanced, Basic, or Standard, you will do it manually and submit it to the Social Security Administration.


To know more info about the process, you can check out this article: Fix an incorrect W-2. Once you're on this page, locate the section with your payroll subscription and follow the steps.


In addition, regarding Forms 941 and 940, you need to make an amendment. I've got an article for you to assess the process: Correct or Amend Forms 941 and 940.


I'd also recommend speaking with an accounting professional for the best advice on how to handle this process. Your accountant will know more information to provide based on your business needs. If you don't have an accountant, you can find one here in our Resource Center.


Please let me know if you have any other questions or concerns. I'm always here to lend a hand. Take care! 

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