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louis7
New Member

Is third party sick pay considered earn income, if received and reported on W-2 code J, for Earn Income Credit purpose if received before minimum retirement age?

Earn Income for EIC purpose

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SweetieJean
Level 15

Is third party sick pay considered earn income, if received and reported on W-2 code J, for Earn Income Credit purpose if received before minimum retirement age?

Third party sick pay paid by agents [i.e., insurance company] of the employer are treated as supplemental wage income (see Treasury Regulation 31.3402(g)).  Supplemental wage payments are considered to be earned income for purposes of the Earned Income Tax Credit (see Internal Revenue.Code Section 32(c)(2)(A)(i)).

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3 Replies
SweetieJean
Level 15

Is third party sick pay considered earn income, if received and reported on W-2 code J, for Earn Income Credit purpose if received before minimum retirement age?

Third party sick pay paid by agents [i.e., insurance company] of the employer are treated as supplemental wage income (see Treasury Regulation 31.3402(g)).  Supplemental wage payments are considered to be earned income for purposes of the Earned Income Tax Credit (see Internal Revenue.Code Section 32(c)(2)(A)(i)).

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rog3
New Member

Is third party sick pay considered earn income, if received and reported on W-2 code J, for Earn Income Credit purpose if received before minimum retirement age?

Thank you. I am new at this. I looked on-line at the Reg and IRC you quoted and do not find the same wording. What am I doing wrong?
SweetieJean
Level 15

Is third party sick pay considered earn income, if received and reported on W-2 code J, for Earn Income Credit purpose if received before minimum retirement age?

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