Processing and Distribution
SBAS uses the information contained in Escape to process W-2 forms on behalf of districts and transmit electronic files to the IRS and EDD. Our office sends the printed W-2 forms to the districts for distribution to employees.
- W-2 forms must be distributed on or before Jan. 31. Any forms that you have in your possession on Jan. 31 must be mailed and postmarked via United States Postal Service on that day.
- If your district determines that a W-2 correction is necessary, send the request in writing, including backup, to SBAS. Please allow approximately three weeks for processing of the W-2C. Note: No adjustment to federal or state income tax is allowed after the W-2 is issued.
- The W-2s are filed electronically with the Internal Revenue Service under the name of Santa Barbara County Schools - PO Box 6307, Santa Barbara, CA 93160-6307. SBAS will refer all W-2 telephone calls from district employees to the appropriate district payroll department.
- W-2s that your district is unable to deliver to the employee, after a reasonable effort, must be retained by your district for a four-year period. Reasonable effort has been made if the employer mailed the W-2 to the last known address of the employee, and it is thereby determined to be undeliverable.
- Districts will need to place the employee W-2 forms in the window envelopes provided. Duplicate W-2’s can be printed from Escape HR/Payroll > Processes > Tax Reporting > Employee W2 tasks. In the Report Warehouse you will find Pay 26 Employer W2 Copy, Pay 27 W2 Summary, and Pay 91 Quarterly Report.
In order to satisfy federal and state tax reporting requirements, there are additional compensation items that require special processing for inclusion on employee W-2 documents.
Domestic Partner Insurance
Domestic Partner or Civil Union Spousal Health coverage consists of the imputed taxable value (fair market value of the insurance) of the cost of the domestic partner health insurance benefits. Contact your insurance provider for the formula and taxable amounts. This may include the taxable value even if there is no additional cost to the employer. This only applies to Federal Tax, and not to State of California tax. Non-Registered Domestic Partner health coverage is taxable for both federal and state.
California law (AB 205) requires all California employers to offer the same health care benefits to employees with registered domestic partners that are offered to spouses to dependents of employees.
Group Term Life Insurance
Group term life insurance is a type of insurance in which one contract is issued to the employer who then offers coverage as a benefit to employees. Term coverage protects you for a limited number of years, while whole life provides lifelong protection.
IRC section 79 provides an exclusion for the first $50,000 of group-term life insurance coverage provided under a policy carried directly or indirectly by an employer. There are no tax consequences if the total amount of such policies does not exceed $50,000. The imputed cost of coverage in excess of $50,000 must be included in income, using the IRS premium table, and are subject to Social Security and Medicare taxes.
Employers and employees with specific tax questions should seek advice from their tax counsel, CA Employment Development Department (EDD), or the Internal Revenue Service (IRS). This information is not intended as tax advice.
EDD Publication DE44 California Employer Guide
EDD Publication DE231EB Taxability of Employee Benefits
IRS Publication 15-B Employer’s Tax Guide to Fringe Benefits
IRS Publication 525 Taxable and Non Taxable Income
IRS Code Section 61, 106; IRS Publication 15, 15B and various IRS Letter Rulings