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sarahs814
New Member

How do I enter disability income on TurboTax? My W2 is wrong (employer only reported 1/2 of it due to end of year and put other half in 2018).

The amount in box j third party sick pay on my 2017 W2 is only taking into consideration the first two of four disability payments I received in 2017. The statements for the last two were from the end of December and didn't get mailed before my employer finalized the W2s for the year. Now I need to report my disability income somewhere. I can't find an area in Quickbooks and I am not sure what I am supposed to enter...
1 Reply
DianeW
Expert Alumni

How do I enter disability income on TurboTax? My W2 is wrong (employer only reported 1/2 of it due to end of year and put other half in 2018).

Constructive receipt is the term used by the IRS for the amount to include in your income for the year.  Your employer must follow the same rules.

For federal income tax purposes, the doctrine of constructive receipt is used to determine when a cash-basis taxpayer has received gross income. A taxpayer is subject to tax in the current year if he or she has an unrestricted control in determining when items of income will or should be paid. 

Maintain your records including, but not limited to, bank statement, envelope with mail date, etc., with your tax records.

If you received the income before December 31st then it should be reported on your 2017 return with a corrected W2 from your employer.  This would mean you physically received the checks in your possession in 2017. Ask your employer for a corrected form for your tax return.

If your employer did not release the checks to you before the end of the year, then you may have to report the income in 2018. Again, check with your employer about a correction based upon your statement that you did have the disability pay in 2017.

If you employer refuses to provide a corrected W2 and you did receive the money by December 31st, you can choose to use a Substitute W2, Form 4852.  The instructions for filing this form are included below, it must be filed by mail per IRS.

https://ttlc.intuit.com/replies/5451995

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