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W2 Box 14 Reporting Requirements for Covid-19 Pay

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Description

For the tax reporting year, the federal government has designated six (6) different emergency or qualified sick and family leave-related wage types to report in  Box 14  of form  W-2. From the  5-2-2 Payroll Records,  Absence Reason column, you should create absence reasons corresponding with the Aatrix Form W-2, Box 14 emergency or qualified sick and family leave-related wage type descriptors. You can assign an Absence Reason to existing timecard lines even after posting payroll records. However, after computing a payroll record, you cannot add new lines to the payroll record.

Resolution

From menu 5-2-2 Payroll Records, set up Absence Reasons matching each of the federally designated COVID-19, emergency paid sick, medical and family leave-related wage types.

  1. Open the 5-2-2 Payroll Records window.
  2. From the grid area of the window, ensure the Absence column is visible. If this column is hidden, you can show it by right-clicking on the grid, selecting Show/Hide Columns and checking the Absence column; then right-clicking on the grid again and selecting Save Current Grid View to lock in the change.
  3. Click in the Absence column, press the F6 button on your keyboard or right-click in the column, then click Display Detail/Add Record from the shortcut menu.
  4. In the Absence Reasons window, add six (6) absence reasons matching each of the emergency paid sick, family, and medical leave items noted in the table displayed below. Due to the 50-character limitation for the Description field in the Absence Reason table, you should enter the description for each absence reason item as in the example displayed below, as these descriptors match those used for Aatrix's W-2, Box 14.

 NOTE: The numeric Absence# you assign to each item does not need to match the absence number shown in the example below. 

Absence# Description:
100 Emerg Paid SL $511 Limit-1/1/21-3/31/21(511ESLBA)
101 Emerg Fam and Med Leave-1/1/21-3/31/21(EFMLEABA)
102 Emerg Paid SL $200 Limit-1/1/21-3/31/21(200ESLBA)
103 Emerg Paid SL $511 Limit-4/1/21-9/30/21(511ESLAM)
104 Emerg Fam and Med Leave-4/1/21-9/30/21(EFMLEAAM)
105 Emerg Paid SL $200 Limit-4/1/21-9/30/21(200ESLAM)
  1. After adding the Absence Reasons to the Absence Reasons table, press File, and Save.
  2. From the 5-2-2 Payroll Records window, select the applicable employee and enter other timecard header information as usual.
  3. In the Timecard grid, use a separate line for each day or partial day of COVID-related absence:
    1. Enter the date, day, and description (as needed), as well as the pay type, pay rate, hours, and comp code, as usual.
    2. Tab to the Absence column, and then click the arrow to open the Lookup window.
    3. Select the applicable COVID-related absence type you need for reporting purposes.
      Caution! Do not override social security amounts, even if you cannot pay them. Doing so will cause errors in your payroll audit. Payroll will expense these amounts, job-cost them (as necessary), and post them to the tax liability account. If your tax liability is reduced by federal COVID-19 assistance, you can remove the excess liability by recording a journal transaction when you take the reduction (for example, when you pay your tax bill).
  4. Save the payroll record.
  5. Compute payroll as usual.
  6. Print the menu 5-1-8-91 Absence Hours and Wages ~ by Employee report to display COVID-19 related sick pay hours and wages and as an aid to completing your Form W-2, Box 14 information.
  7. For detailed steps regarding how to add a Covid-19 related pay column to the W-2 and link that column to the correct COVID-19 related W-2 box code, please view this video DocLink: Reporting COVID-19 Related Wages on Form W-2, also available in the Related Resources section below.

Important! When entering payroll records for SALARIED employees, ensure that timecard entries account for ALL the hours in the pay period, including both times worked and COVID-related absences. For example, say that a weekly salaried employee typically works a five-day, 40-hour week. In this pay period, they worked Monday through Wednesday as usual, but on Thursday and Friday, they began a COVID-related absence. Their timecard for this pay period should use a minimum of three timecard lines:

  1. One line for 24 hours with no rate and no entry in the Absence column to account for the time worked.
  2. One line for Thursday with 8 Hours and a COVID-related absence type in the Absence column.
  3. One line for Friday with 8 Hours and a COVID-related absence type in the Absence column.
  4. We recommend that you do not sum absences for multiple days on a single timecard line. If your government requires you to report the exact number of days or weeks, this information will be harder to determine if absence days are combined.
  5. You can assign an Absence Reason to existing timecard lines even after posting payroll records. However, after computing a payroll record, you cannot add new lines to the payroll record.

Remittances to Governments

When you need to remit your employer contributions for social benefit taxes to the government, you must calculate and deduct the amounts for which you are not liable. You can use the menu 5-1-8-91 Absence Hours and Wages ~ by Employee report, found in the Related Resources section below that will display COVID-related absence hours and wages. If your tax liability is reduced by federal COVID-19 assistance, you can remove the excess liability by recording a journal transaction when you take the reduction (for example, when you pay your tax bill).


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