Employer reported imputed income for my husband and won't issue corrected W-2 forms.

[FunMiles]

I got married in 2016. My husband and I filed as married for 2016, 2017 and 2018. 

We realized at the end of 2018 that the 2016 and 2017 had imputed income for the insurance premiums of my husband.

My employer refuses to issue corrected 2016 and 2017. Are they allowed to refuse that?

If so, how do I file a correction?

[VolvoGirl]

Why is it wrong?  If the employer pays premiums for over a certain amount of life ins for you (it was 50,000 might be different now) you have to report the premium for the ins amount over 50,000 as income.   When I worked I kept my coverage at less than 50,000 to not have imputed income.

[VolvoGirl]

I'm sorry I answered for life insurance.  Did you mean health ins?

[FunMiles]

Yes I mean for health insurance. It is taxable if you are non-married partners, but not taxable when married.

[mz88]

I have a very similar situation. Did you end up amending your tax return? How did you handle? Thanks

[FunMiles]

Yes I did file an amended return, explaining in an attached document / letter why the W2 was incorrect.

It took several years before the IRS refunded the overpayment with interest. You have to do the filing within three years of the original return due date. Keep all documents and proof of mailing. They disputed the timing by saying it was too late to file, taking the date of processing for their argument. I protested with the certified mail receipt showing the mailing date was within the three year limit.

Good luck

[mz88]

Thank you for the reply. Glad to hear you ultimately ended up receiving the refund! Do you by chance remember how you reported the corrected figures on your amended return? Did you back out the imputed income and adjust the wages amount from the W-2 income? I saw someone suggest reporting a negative amount as other income (for the imputed income) with an explanation.

I also saw someone else suggest filing a form 4852. Just wondering how you handled. Really appreciate your help!

[FunMiles]

I believe my tax lady replaced the W2 numbers from the company with the values they should have been. She then redid the rest of the computations normally with the updated numbers. The letter attached to the amendment explained why the company's W2 numbers were incorrect and why the correct numbers had to be the one she used. Then there is a final document with the difference between what was originally filed and the amendment, giving the expected refund.

The IRS took that number and added interest and sent me a check.