To file Form 8922, the Third-Party Sick Pay Recap, a third-party payer or an employer completes one form for each employer-payer pairing where the liability for the employer’s share of Social Security and Medicare taxes on sick pay was transferred between them, then mails it to the Social Security Administration by the last day of February after the year the sick pay was paid.1Internal Revenue Service. Form 8922 (Rev. October 2024) – Third-Party Sick Pay Recap The form is what lets the IRS reconcile sick pay reported on Forms 941 with the wages shown on Forms W-2 when two different entities touched the money.
Do You Actually Need to File It
One question decides this: did the third-party payer shift the employer’s share of Social Security and Medicare taxes back to the actual employer? If yes, the third-party payer files Form 8922 to report the aggregate sick pay it distributed that year.1Internal Revenue Service. Form 8922 (Rev. October 2024) – Third-Party Sick Pay Recap If the payer kept the employer-side liability, the payer is treated as the employer for those taxes and reports everything on its own Form 941. No Form 8922 is needed in that case.2Internal Revenue Service. Publication 15-A (2026), Employer’s Supplemental Tax Guide
A separate boundary matters here. Not every outside entity paying sick pay is a “third-party payer” for this purpose. An agent, meaning an outfit that bears no insurance risk and is reimbursed on a cost-plus-fee basis to distribute payments using the employer’s money, is not a third-party payer. The employer stays fully responsible for all employment taxes, and Form 8922 does not apply.3Internal Revenue Service. Publication 15-A (2026), Employer’s Supplemental Tax Guide A true third-party payer is one that accepted premiums and carries the risk of paying claims, such as an insurance company writing disability policies.2Internal Revenue Service. Publication 15-A (2026), Employer’s Supplemental Tax Guide
Workers’ compensation payments for work-related injuries are not sick pay for federal tax purposes and do not belong on Form 8922 at all.2Internal Revenue Service. Publication 15-A (2026), Employer’s Supplemental Tax Guide
Filling Out the Form
The October 2024 revision of Form 8922 opens with identification blocks for both the third-party payer and the employer: legal names, addresses, and Employer Identification Numbers. Below that sit six numbered boxes for aggregate dollar amounts covering all employees who received sick pay from that payer on behalf of that employer during the calendar year.1Internal Revenue Service. Form 8922 (Rev. October 2024) – Third-Party Sick Pay Recap
- Box 1: Total sick pay subject to federal income tax.
- Box 2: Federal income tax withheld from that sick pay.
- Box 3: Sick pay subject to Social Security tax.
- Box 4: Social Security tax withheld.
- Box 5: Sick pay subject to Medicare tax.
- Box 6: Medicare tax withheld, including any Additional Medicare Tax.
Each employer-payer combination needs its own Form 8922. One insurance company paying sick pay for five different employers files five forms.
Why Box 1 Often Exceeds Boxes 3 and 5
Sick pay stops being subject to Social Security and Medicare taxes once six full calendar months have passed since the last month the employee worked for the employer. Payments made in month seven and beyond are excluded from FICA wages, though they may still be subject to federal income tax.4eCFR. 26 CFR 31.3121(a)(4)-1 – Payments on Account of Sickness or Accident Disability So the Box 1 total will often be larger than the amounts in Boxes 3 and 5. That gap is expected. What causes IRS notices is an unexplained mismatch, so cross-reference individual payment records against each employee’s last active work date before you commit numbers to the form.
There is also a “CORRECTED” checkbox at the top of the form. Leave it blank on an original filing; use it only when replacing a form you already submitted.
Deadline, Where to Send It, and No Extensions
Form 8922 is due the last day of February following the calendar year the sick pay was paid. If that date lands on a weekend or legal holiday, it moves to the next business day.1Internal Revenue Service. Form 8922 (Rev. October 2024) – Third-Party Sick Pay Recap For 2025 sick pay, the due date is February 28, 2026.
The completed form is mailed to the Social Security Administration’s Data Operations Center in Wilkes-Barre, Pennsylvania. The form’s instructions describe paper filing only; there is no electronic filing alternative laid out for Form 8922, and the electronic filing threshold that applies to W-2s and 1099s is not on the form.
Form 8809, the general extension request for information returns, does not cover Form 8922.5Internal Revenue Service. About Form 8809, Application for Extension of Time to File Information Returns If your sick pay data is not ready in mid-February, there is no formal mechanism to buy extra time. Plan the data pull well before the deadline.
Reconciling With Form 941 and the W-2s
Form 8922 is a recap; the underlying tax movements happen on the Form 941 filings of both parties. When the third-party payer transfers the employer share of Social Security and Medicare taxes to the employer, each side makes offsetting adjustments. The employer reports the sick pay as taxable Social Security and Medicare wages and enters a negative adjustment on Line 8 for the employee-share taxes the third-party payer already withheld and deposited. The third-party payer takes its own Line 8 adjustment for the employer-share taxes it transferred out. Without these matching entries, the IRS sees double-counted taxes and sends notices.6Internal Revenue Service. Instructions for Form 941
On the W-3, Box 13 is left blank for third-party sick pay; the instructions direct filers to Form 8922 for the reconciliation instead.7Internal Revenue Service. 2026 General Instructions for Forms W-2 and W-3 Who issues the W-2s depends on whether the third party gave the employer a complete sick pay statement by January 15 of the following year. If yes, the employer includes the sick pay on the employees’ W-2s. If the third party missed that January 15 deadline, it prepares the W-2s itself.8Internal Revenue Service. Notice 2015-6, Reporting Sick Pay Paid by Third Parties Either way, the totals on Form 8922 should match what flows through the W-2s and 941s.9Internal Revenue Service. About Form 8922, Third-Party Sick Pay Recap
Fixing a Form You Already Filed
If you find an error after filing, submit a corrected Form 8922 as soon as you can. Fill in every field with the correct information, not just the boxes that changed, and check the “CORRECTED” box at the top.1Internal Revenue Service. Form 8922 (Rev. October 2024) – Third-Party Sick Pay Recap Speed matters because the IRC §6721 penalty tiers reward fast corrections.
Penalties for Late or Incorrect Filings
Late filing or filing with incorrect information triggers information return penalties under IRC §6721. For returns due in 2026, the per-return amounts are:10Internal Revenue Service. Information Return Penalties
- $60 if corrected within 30 days of the due date.
- $130 if corrected after 30 days but by August 1.
- $340 if filed after August 1 or not filed at all.
- $680 per return, with no annual cap, for intentional disregard.
Annual maximums apply for the non-intentional tiers. Businesses with gross receipts over $5 million face a cap of $4,098,500 at the highest tier. Businesses with gross receipts of $5 million or less have a reduced cap of $1,366,000.11Internal Revenue Service. IRM 20.1.7 Information Return Penalties Caps reset each calendar year, so repeated failures compound. Correcting inside 30 days cuts the per-return exposure by more than 80% compared with letting the problem sit past August 1.