What payroll is reportable?
In defining payroll, we generally follow the guidelines of Medicare wage reporting, with exceptions involving construction industry and corporate officer wages. We consider the following general items as payroll.
- Gross hourly wages and gross salaries less qualifying deductions for section 125 cafeteria plan benefits (usually Medicare wages*)
- Sick pay (including third party, excluding workers' comp)
- Bonus payments, including stock given as a bonus
- All sales commissions
- All tips
- Severance pay
- Overtime pay
- All shift or holiday differential pay
- All stock gifts
- Profit sharing going directly to the employees as payroll
- Any voluntary employee contributions to retirement plans, including 401K
- Any portions of cafeteria plans as reportable to the Federal Unemployment Tax Authority (FUTA), such as cash options and unqualified benefits (Normal employee contributions are not reportable.)
- Reasonable value of board, lodging, house or room rent unless provided for the convenience of the employer
- Per diems and traveling expense is reportable if this amount exceeds one-third of the employee's total remuneration. Total remuneration includes the regular wages, per diems and traveling expense. The amount of per diem and/or traveling expense that exceeds one-third of the total remuneration is reportable.
- Contributions to deferred compensation by employees (except for contributions to a governmental 457 plan)
- Expenses exceeding one-third of an employee's normal pay
- Personal use of company car
- Payments to casual/spot labor
*Premiums for life insurance over 50k not reportable to BWC.
Minimum and maximum payroll reporting requirements
Minimum payroll is defined as the minimum amount (minimum reportable wages per person per week) that an employer must report to BWC when an employee or volunteer works for their business. Salaries for all employees must be reported at the minimum amount shown below.
The following individuals are subject to a minimum and maximum payroll reporting requirement:
- Active executive officers of a corporation.
- Employers listed below who choose elective coverage because they're not required to carry workers' comp insurance.
- Sole proprietors.
- Family farm corporate officers.
- Limited liability company acting as a partnership.
- Limited liability company acting as a sole proprietor.
- Individual incorporated as a corporation (with no employees) which includes C-Corp, S-Corp and LLC Corp reporting as a C-Corp or S-Corp.
Individuals in any of the categories above must report a minimum and maximum payroll based on the state average weekly wage (SAWW). Reporting guidelines are as follows.
||Minimum reportable wages per person per week
||Maximum reportable wages per person per week
|July 1, 2018 - June 30, 2019
|July 1, 2017 - June 30, 2018
|July 1, 2016 - June 30, 2017
|Jan. 1, 2015 - June 30, 2016
|Jan. 1, 2014 - Dec. 31, 2014
|Jan. 1, 2013 - Dec. 31, 2013
|Jan. 1, 2012 - Dec. 31, 2012
|Jan. 1, 2011 - Dec. 31, 2011
|Jan. 1, 2010 - Dec. 31, 2010
|Jan. 1, 2009 - Dec. 31, 2009
|Jan. 1, 2008 - Dec. 31, 2008
|Jan. 1, 2007 - Dec. 31, 2007
|July 1, 2006 - Dec. 31, 2006
|Prior to July 1, 2006
*Prior to July 1, 2006, there was no minimum reporting requirement for corporate officers.
Construction industry payroll limitation
Since 1995, construction industry payroll limits have been established for manual classification codes in Industry Group 4. BWC reviews the limits each year and revises them as needed. The construction industry employer who chooses to use the limit when reporting payroll must maintain records to verify the weekly wages paid to construction industry employees. The payroll limitation applies to weekly payroll, regardless of the hourly or daily remuneration.
Apply the weekly cap on an employee-by-employee basis. In the absence of weekly records, you can only take advantage of the cap on the whole payroll reporting basis. It makes no difference if the employee is full time, part time or seasonal. Section 125 cafeteria plan deductions must be deducted PRIOR to calculating the excess amount. Bonuses paid in the policy year are to be spread out among the weeks worked. The weekly construction cap does not affect officers of the corporation or owners with elective coverage since the weekly officer cap is the same as the weekly construction cap.
The reportable payroll will not exceed the weekly limits outlined in the following table.
||Payroll limitation cap
|July 1, 2018 - July 1, 2019
|July 1, 2017 - July 1, 2018
|July 1, 2016 - July 1, 2017
|July 1, 2015 - July 1, 2016
|July 1, 2014 - July 1, 2015
|July 1, 2013 - July 1, 2014
|July 1, 2012 - July 1, 2013
|July 1, 2011 - July 1, 2012
|July 1, 2010 - July 1, 2011
|July 1, 2009 - July 1, 2010
|July 1, 2008 - July 1, 2009
Payroll reporting for corporate officers
Corporate officers include the president, vice president, secretary, treasurer and any other executive officers, which are specified in, and empowered by the charter or regularly adopted bylaws or minutes of the corporation. Persons who are elected, appointed, or empowered by the directors and perform duties for the corporation must also be covered. A corporate officer may also be referred to as executive officer of a corporation, executive officer or officer. With exceptions noted in this policy, BWC considers corporate officers employees of the corporation, and they are covered under the workers' comp policy. If the corporation is nonprofit:
- The executive director will be considered a corporate officer.
- A person who volunteers his or her services as a corporate officer will not be considered an employee for workers' comp purposes.
Persons who are elected or appointed as officers, empowered by the directors and perform duties for the corporation also must be covered. Report the payroll of corporate officers under the manual classification that appropriately describes their duties.
Corporate officers of Subchapter S corporations must report a reasonable wage for the services they perform. If the regular earnings do not constitute a reasonable wage for the services performed, then his/her portion of ordinary income from Federal Income Tax Form 1120S Schedule K-1 (less section 179 depreciation deduction) is to be included (added to their regular earnings) to establish a reasonable wage up to the maximum. Net losses are not to be deducted. Ordinary income should be estimated if tax returns are not completed.