My wife recieved sick pay while on maternity leave from a third party short term disability plan that she paid into via her job using payroll deductions from her salary. The W2 we reiceved shows the amount that was paid out to her in Box 1 with no federal taxes taken out, just social and medicare taxes. Box 12 is what confuses me. In box 12 A it is list code "J" then next to it is the exact dollar amount that is in Box 1. In the W2 instructions it states a code of J in box 12 denotes "Nontaxable Sick Pay". I've researched and people have stated that when you get a W2 from a third-party sick pay payments that you pay into, Box 1 is supposed to be blank and box 12 A will have a"J" code in it denoting the payments are non-taxable. It's also suggested that due it being non-taxable to not report it and it's meant more informational than for the purpose of filing. Given mine has an amount in Box 1 with a dollar amount, but that same amount shows in Box 12 as Non-Taxable, do i still report this on my taxes? Will i taxed even though code J is listed?
