Sick pay - Form W-2 or Form 1099?

[Lori Friedman]

In your opinion, is sick pay (other than payments to a decedent's estate or beneficiary) ever reported on Form 1099?

Employer pays the benefits -- report on Form W-2, filed by the employer

Employer's agent pays the benefits -- report on Form W-2, filed by the employer

An independent third party makes the payments -- report on Form W-2, and the third party may or may not transfer the filing obligation back to the employer

I'm working with a VEBA that provides sick pay benefits, withholds no taxes, and reports the payments on Form 1099. I can't think of any reason why this approach could be correct and acceptable.

[Guest b2kates]

I agree with your analysis.

Sick pay is compensation in lieu of wages and depending on payor/reporting entity,should be on a W-2 .