How to Add Third Party Sick Pay (disability payments)

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During the year and especially at year-end, you may receive notices regarding third party sick pay or disability payments for an employee. As an employer, you will be required to report these short-term or long-term disability payments on the employee's W-2. 

You may also be responsible for reporting and paying the employer Federal income, Federal unemployment (FUTA), state unemployment (SUI/SUTA) tax amounts, as well as matching Social Security and Medicare. Confirm the details in the plan to ensure you are recording and paying correctly. 

You will be receiving a statement from either the state agency or the third party disability provider with the payment and tax amounts. 

Please email the statements as soon as you receive them to the payroll team - - and we can have those amounts reported on your tax return and any other applicable annual forms.  

  • Please note, any requests received after January 6th, 2023 will be filed as a correction to your original tax filings. 

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