So it’s not a task that anyone would put on their list of “fun things” or “enjoyable hobbies”, rather more likely on the list of “Ugh, do I have to?” items, but the time is here: It’s time for employee and government wage reporting.
Whether your church uses Church Windows Software or another package, W-2s may be often be printed directly out of your software in black and white on a standard laser printer (not ink jet.) Appropriate forms can be obtained at your local office supply stores or through Dynamic Systems (800-782-2946 or www.dswebtoprint.com). Either one is a fine option. We have found that Dynamic Systems will send out smaller quantities than the packets typically available at office supply stores.
Paper copy W-2s can be submitted directly to the Social Security Administration via US Mail. If you prefer Electronic Filing, churches with 50 or fewer W-2s to file can use the Social Security’s online system (provided that you have registered online.)
If your software includes it, the Nelco Wage Filer can submit W-2 forms electronically through the software. The IRS will accept black and white W-2s on paper so any typical Payroll program will print them for you and not require you to purchase forms. But, IRS does still require 1099’s and 1096’s on their forms. So those forms need to be purchased for your software to print. Electronic Filing can be done through Nelco Wage Filer within most Payroll programs. A number of states require filing W-2s and 1099s at the same time if there is any withholding from 1099 contractors. Learn more about Nelco at www.nelcosolutions.com.
Paper 1099 forms can be printed from most good Payroll or Accounting software programs. But please note that the “red ink” forms are required for submittal to submit to the IRS. The best bet on acquiring these forms is through Dynamic Systems or an office supply store. Libraries and post offices also have the forms, but the paper used for the recipients’ copy has been known to jam printers.
Health insurance premium reimbursements are now taxable if the employee does not participate in the company’s group health plan. A customer question recently came in about health insurance for employees. This question encompassed two totally different situations.
- If an employer gives an employee cash to purchase health insurance, or they pay a health insurance premium that is not a group policy, it is fully TAXABLE. The church, in reporting, can either increase regular wages or set up a fully taxable allowance. It does not need to be separately stated in Box 12 of the W-2.
- In Payroll programs, there is often a special function for the non-taxable employer paid portion of GROUP health insurance. This function is present in Church Windows Payroll. Only employers submitting 250 or more W-2s in the prior year are required to provide this information but a number of our customers want to include this information on the W-2. This does not increase taxable wages and it is shown in box 12 of the W-2 with a code of DD.
While the employee wage and tax reporting tasks are neither fun nor simple, a calm approach, some reading preparedness, and maybe a warm cup of decaf coffee can definitely help your path through the tasks. Happy filing!