Is GTL subject to federal withholding?

Dependent GTL is exempt if it is less than $2,000. The value of coverage in excess of $50,000, less any employee after-tax deductions to pay for insurance, is taxable income to the employee subject to federal income tax withholding, social security, and Medicare.

Is GTL a taxable wage?

The premiums for any group term life insurance over $50,000 are considered taxable income.

Is GTL included in gross wages?

Group Term Life Insurance (GTL) On your paycheck under Deductions, you will see “GTL” with a benefit amount. Because GTL is only subject to social security and Medicare taxes (FICA = 7.65%), $0.83 would be deducted from your gross pay to cover this taxable fringe benefit.

What is the GTL deduction on my paycheck?

What does “GTL” mean on my paycheck? GTL stands for group term life. Your life insurance policy with Principia is for two times your annual salary. On your paycheck under Deductions, you will see “GTL” with a benefit amount.

Do I report life insurance on my taxes?

Generally, life insurance proceeds you receive as a beneficiary due to the death of the insured person, aren’t includable in gross income and you don’t have to report them. However, any interest you receive is taxable and you should report it as interest received.

What taxes are taken out of imputed income?

Imputed income is subject to Social Security and Medicare tax but typically not federal income tax. An employee can elect to withhold federal income tax from the imputed pay, or they can simply pay the amount due when filing their return.

Are payments from life insurance taxable?

Answer: Generally, life insurance proceeds you receive as a beneficiary due to the death of the insured person, aren’t includable in gross income and you don’t have to report them. However, any interest you receive is taxable and you should report it as interest received.

Is GTL included in Box 1?

GTL imputed income is reported on the Form W-2 as wages (Box 1), SS wages (Box 3), Medicare wages (Box 5), and in Box 12 using Code “C”.

Do you have to withhold state income tax on GTL?

We have been given a directive to withhold state income tax on GTL starting next January. statutory requirement. I can’t think of any good reasons to why someone may choose to withhold the tax. Just as a reminder, in case you have employees in PA, GTL imputed income isn’t taxable in PA (if I remember correctly).

What does GTL stand for on a paycheck?

If you see GTL which stands for Group Term Life on your paycheck, it means your employer has elected this organization-wide benefit that essentially pays your beneficiaries a portion or full amount of your annual salary. This is a taxable benefit…

How much money do you have to make to claim GTL?

This is a taxable benefit (FICA taxes Medicare & Social Security) for any earnings over $50,000/year. If you make over $50,000/year, you will notice GTL appear both as earnings and deductions.

Is the cost of group term life insurance taxable?

The cost of employer-provided group-term life insurance on the life of an employee’s spouse or dependent, paid by the employer, is not taxable to the employee if the face amount of the coverage does not exceed $2,000.