To join in on this discussion, you must first
log in.
Discussion:W-2 and S Corp Medical
From TaxAlmanac, A Free Online Resource for Tax Professionals
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.
From TaxAlmanac
Discussion Forum Index --> Tax Questions --> W-2 and S Corp Medical
Actionbsns (talk|edits) said: | 6 January 2007 |
| I was just reviewing the W-2 as printed through Quickbooks for my client, the only stockholder in this S Corp. The value of the health insurance premiums is in the gross federal wages, but not included in the state wages. Is that a problem? Why would it not be included for the state? BTW, if it matters, it's the state of Hawaii.
Paula | |
| 6 January 2007 | |
| I'm not from Hawaii, but the Fed'l and State taxable wages should be the same. Could it be that the software program wasn't programmed correctly? | |
Michaelstar (talk|edits) said: | 6 January 2007 |
| I agree, the health insurance premiums s/b included in both federal and state wages on the W-2. | |
Actionbsns (talk|edits) said: | 6 January 2007 |
| That's what I thought, now I need to figure out how to get QB to make them the same. I can manually adjust the figure, but I'd like to just have confidence in the program so I can have an employee do them and not have to be so concerned about it. I've gone through the set up about three times, and there doesn't seem to be a place that's missed regarding state taxes. Maybe I'll just call Intuit or post on the website. Unless anyone else has had this happen and fixed it. | |
| 6 January 2007 | |
| Sorry if this is covering what you've already done, but did you look under Payroll Items and edit the health insurance category to be certain that the taxes are checked correctly? | |
Actionbsns (talk|edits) said: | 6 January 2007 |
| Thanks, LJA, I've checked all that and now I've left a message at the payroll forum on the QB website. It's not nearly as user friendly as this forum is to use, in fact it's terribly frustrating. For now I just changed the number manually and I'm hoping for a solution to the problem within QB. Changing things like that always creates room for error. | |
| 6 January 2007 | |
| On a related subject, the social security wages & medicare wages should be less than the federal & state wages by the amount of the medical, right? (assuming nothing else affecting these items, and assuming non-discrimination).
Paula, I can't think of anything off the top of my head that would cause a Hawaii difference. The only times I see a difference is usually b/c of Hawaii ERS (e.g., for firefighters). | |
Actionbsns (talk|edits) said: | 7 January 2007 |
| Yes, Bengoshi, the FICA/MC are less than the wages in Box 1 by the amount of the medical. Still no answer from QB as to a solution and it took me several minutes to be able to navigate back to the forum where the question is posted. I don't think this is a Hawaii difference, just something in the program that needs tweaking someway. | |
| 7 January 2007 | |
| I don't know what version of qbks you are using, but in the payroll item list, this should be calculating it correctly. Check the company contribution (health insurance) and make sure it is taxable for fed and not fica. Then try checking your state income tax p/r item and make sure that this health insurance item is checked to calculate it. You might have already done the above and if so...then you have a very goofy quickbooks file...hehe | |
Actionbsns (talk|edits) said: | 7 January 2007 |
| Sandysea, I really had my hopes up there for a minute, just went remote into the data file of my client and checked the state w/h payroll item. Sure enough S Corp Med wasn't marked. So I marked it, but there was no change on the W-2. Checked the Fed payroll item and it's not marked either. So I read a little more about that check mark and it only calculates the withholding on the value of the insurance. In this client's case, we don't really want the program calculating withholding because by the time we add this to the mix we have our eye on their whole picture and are adding S-corp Med to the final paycheck on which we are already adjusting withholding for the year. So I'm back to manually changing the number. No response yet from QB either. Today's my birthday, so maybe I'll get a birthday present - whaddaya think? | |
Bottom Line (talk|edits) said: | 7 January 2007 |
| You'll need to go back and change each paycheck individually. That should correct it. (Try one first and see if it changes the W-2.) I run into this when the SUTA rate changes and the client doesn't tell me. Sometimes I have to delete the paycheck and re-enter it to make the change take effect. If you do this, don't forget to go back and re-reconcile your bank account. | |
| 8 January 2007 | |
| Yes Action and HAPPY BIRTHDAY TO YOU!!! Mine was the 4th, so we are both Capricorn babies...damn them goats!! Anyway, BL is correct. You have to change each payroll check. Some versions of qbks you can change the check and it will recalculate, but more than lifely you will have to delete the check and put in a new one. Also, like BL said, qbks will ask you if you "mean" to change a reconciled item in the bank and you have to allow that and then reclear the checks (if not outstanding). This should take care of the problem. If not, let me know and I will try to help walk you through it. Qbks can be very goofy at times, no? | |
Bottom Line (talk|edits) said: | 9 January 2007 |
| Agreed from another Capricorn. I remember seeing somewhere that we're prone to be anal retentive. Maybe that's why we're accountants :) | |
| 9 January 2007 | |
| Paula, I can confirm that you are correct that the health insurance premiums for a more-than-2% S corporation stockholder should be included in wages for Hawaii purposes. Hawaii starts the calculation of taxable income with federal AGI, and there is no statutory adjustment for S corporation health insurance premiums. I looked.
I'm no help with the QuickBooks problem, though. | |
Actionbsns (talk|edits) said: | 9 January 2007 |
| Thanks again all. Still no response from QB, but I found another thread, so I'm not giving up. There has to be something I'm overlooking. I'm always tweaking QB to correct something or other on a check that's cleared, then you have to go in, clear it, and re-do the bank rec to fix that. If you do that, be sure to change the reconciled date to the previous month or it screws things up on the next month. I'm always cautioning clients to not do this, though. Also, I think that a Capricorns we are predestined to being accountants. Katie are you from Hawaii, too? Happy Birthday, Sandysea!! | |
| 9 January 2007 | |
| No, I'm in California, but I have access to RIA's 50-state service, so I can look things up. | |
| 9 January 2007 | |
| for sure Action...accountants or attorneys...I have not ONE OUNCE of creative genious in me when it comes to arts...but let me read, study, explore numbers or legal stuff and I am loving life!! | |
| 30 May 2008 | |
| Actionbsns: Did you ever resolve the W-2 issue of getting Box 16 State Wages to include the S-Corp Med Ins amounts for officers? I need help with the same QB issue. | |
To join in on this discussion, you must first
log in.
