What is third party sick pay?
Sick pay is any amount paid to an employee for any period during which the employee is temporarily absent from work because of injury, sickness, or disability. The third party payer, usually an insurance company, is usually responsible for withholding the employee’s taxes from the payment. The employer however, is still responsible for payment of employer-related taxes. Refer to the IRS document titled Circular E, Employer’s Tax Guide (www.irs.gov/pub/irs-pdf/p15.pdf).
Related links
How do I set up third party sick pay codes?
How do I set up the employer's tax pay code for Social Security?
How do I set up the employer's tax pay code for Medicare?
How do I add the third party sick pay code to an employee?
How do I enter a check for third party sick pay?
How do I calculate employer-related taxes for third party sick pay?
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