QuickBooks® for Contractors Bookkeeping Tips & Training
QuickBooks Add-On Trials
Request FREE 30-day Trials of QuickBooks add-ons for Certified Payroll, AIA Billing & Payroll Wage Management.
Free 30 day trials of QuickBooks integrated add-ons for certified payroll, aia billing and weighted-average overtime
Show Cart

Video: Payroll Tip-Health Insurance Tracking Requirements for 2012

Print Friendly, PDF & Email

The IRS will require that employer’s report the cost of company paid health insurance on employee W-2’s for informational purposes only – the costs of the health insurance is non-taxable.

Many companies who use QuickBooks usually pay the health insurance premium bill on a monthly basis in one lump sum, which is made up of a specific amount for each employee based on the type of plan or coverage that each employee has.  Often times the health insurance payment is treated just like any other bill that the company receives and when handled in this manner, the amounts paid for each employee will not flow through to the W-2 automatically and these amounts will have to be entered manually when W-2?s are prepared.

Thankfully, the QuickBooks payroll module is very flexible and can be set up to automatically track the company paid portion of employee’s health insurance each time you run payroll. I’ve been teaching open shop or non-union contractors, who work on prevailing wage projects, who take a credit for company sponsored health insurance against the full fringe benefit rate this method for years.

When these amounts are run through payroll they will automatically flow through onto any W-2?s that you process at the end of the year.

This mp4 video (even though a little outdated at this point) will show you how to track the costs of 100% company paid health insurance so that it will display on employee pay stubs and the W-2 at the end of the year.  During the setup of the item that you will use for health insurance tracking, make sure that when you get to the Tax Tracking Type screen that you choose Health Coverage Cost from the drop down menu – this information is NOT shown in the video below as it was not available at the time the recording was made.

tracking health insurance in QuickBooks video

This video also demonstrates the use of our Excel-based Health Insurance Calculator, which you can request from a companion article called Calculating Company Paid Health Insurance & The Affordable Care Act.

12/19/2012 – Update.  Download the latest Health Coverage Reporting User Guide for QuickBooks – straight from Intuit – which was just revised 12/12/12.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

About Your Host:
Nancy Smyth, Certified QuickBooks ProAdvisor

Nancy Smyth, Sunburst Software Solutions, Inc.
QuickBooks Construction & Payroll Expert

I've been using and supporting QuickBooks products since the early 1990's. I've worked with thousands of contractors, assisting them with QuickBooks setup, Certified Payroll Reporting requirements, AIA Billing and Weighted-Average Overtime.

QuickBooks is a powerful product, but learning how to use it in your construction business can be difficult. I hope you find resources available here to be helpful.

Get the latest news

Sign up to receive information about our newest eBooks, live webinars, pre-recorded video's and free QuickBooks training via email:

Enter your email address:

Delivered by FeedBurner

We promise not to sell, rent, or otherwise distribute your name and email address.

QuickBooks Time Tracking:

Save 10%/Free 14 day trial

QuickBooks Time Tracker