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Set up and pay New York Health Care and Mental Hygiene Worker Bonus

by Intuit•1• Updated 2 weeks ago

Learn about the New York Health Care and Mental Worker Bonus Program. And learn how to set up and pay this bonus to your employees under this program.

New York (NY) launched the Health Care and Mental Worker Bonus Program on September 2, 2022.  This program aims to attract and retain talent in the health care and mental health industries with bonus payments for qualified employees. 

Bonuses paid through this program are exempt from employee NY state and local taxes. 

Find out more about the program, and check out their FAQs.   

Step 1: Understand program requirements

Eligible employees

Employees must meet eligibility criteria, which includes specific work titles, among others. Find out more about employee eligibility. 

Employers

  1. Submit claims for bonus payments for your eligible employees. 
  2. Pay bonuses to your eligible employees within 30-days of the claim. 

Bonus payments

The maximum payment any employee may get is $3000. These bonuses are exempt from employee NY state and local taxes. 

Bonus payments are based on vesting periods. A vesting period is a series of six-month periods between October 1, 2021, through March 31, 2024. A qualified employee is eligible for up to two vesting periods per employer. 

Find out more about vesting periods. 

Step 2: Set up the New York HWB bonus item

Select your product below to set up the item and add it to your employees.

Note: Not sure which payroll service you have? Here's how to find your payroll service.

For a better experience, open this article in QuickBooks Online. Launch side-by-side view Open this link in a new window

  1. Go to Payroll, then Employees.
  2. Select your employee.
  3. From Pay types, select Start or Edit.
  4. From Common pay types, select NY HWB Worker Bonus Program
  5. Select Save.

Step 1: Set up the item

  1. Download the latest payroll release (22301 or later).
  2. Go to Lists, then select Payroll Item List.
  3. Select Payroll Item, then New.
  4. Select Addition, then Next.
  5. Enter NY HWB Bonus for the name, then select Next.
  6. Select the expense account you want the item to track to, then select Next.
  7. Select New York HWB Bonus for the Tax Tracking Type, then select Next three times.
  8. Enter $3,000 and select One-time-limit for Limit Type, then select Next.

Step 2: Add the item to your employee’s profile

  1. Go to Employees, and then select Employee Center.
  2. Double-click the employee’s name.
  3. Select Payroll Info.
  4. In the Earnings section, add the payroll item you created.
  5. Select OK.

Step 3: Pay the bonus to your employees

For a better experience, open this article in QuickBooks Online. Launch side-by-side view Open this link in a new window

You can pay this bonus on your employee’s regular paycheck or a separate paycheck. Don’t use the Bonus Only option if you’re paying it on a separate check. 

  1. Go to Payroll, then Employees.
  2. Select Run Payroll. Don’t use the Bonus Only option.  
  3. In the NY HWB Worker Bonus Program item, enter the bonus amount. 
  4. Complete the rest of your payroll if needed. 
  5. Select Preview Payroll.
  6. Select Submit.

See Pay an employee bonus.  Follow the instructions in Step 3: Pay out the bonus. 

I already paid a bonus using the regular bonus pay item

 You’ll need to make adjustments to move the bonus payments to the new payroll item so your employee can get a credit for their NY state and NY local taxes. 

Contact us for help with the adjustments.

To move the wages to the NY HWB Bonus item, you’ll need to void and recreate any checks that were paid using the regular bonus item, and reimburse your employees for the NY state and local taxes. 

If you use QuickBooks Desktop Payroll Assisted: you’ll get a message about a backdating fee when you send the new paychecks.  Contact us so we can waive the fee. 

  1. Create a backup of your company file.
  2. Identify which checks were paid out with the regular bonus item. Take note of all the payroll details or print out a paycheck stub.
  3. Void the checks created with the traditional payroll bonus item and send to Intuit.
  4. Recreate the checks using the New York HWB Bonus payroll item. Use the same check date as the original paychecks. If the checks were direct deposit, create a Direct Deposit offset item. 
  5. Reimburse your employees for the NY state and local taxes.
  6. Send your new paychecks to Intuit. 
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