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Set up third party disability insurance

Third party disability insurance is a type of insurance policy that pays an employee when they take a qualified leave from work. Company contributions are always pre-tax, while the employee deduction can be either pre-tax or post-tax. Check out IRS Publication 15-A to learn more about third party disability insurance.

Part 1: Add the benefit

  1. Navigate to the Benefits tab.
  2. From the Health & Life drop-down menu select Disability/Leave
  3. Select Yes, we currently offer this benefit then click Next.
  4. Name the benefit, select what type of insurance you have, enter the employee deduction and company contribution, and upload your plan document. 
  5. Click Save & Continue.

Part 2: Add employees to the benefit

  1. Select which employees receive this benefit.
  2. If needed, customize their employee deductions and company contributions.
  3. Click Save & Continue.

Part 3: Upload distribution reports

When your employee takes leave and makes a claim, you will receive a distribution report that describes the payments they received and any taxes withheld. Depending on your policy, this may need to be included on your payroll. To upload a distribution report:

  1. Navigate to the People tab.
  2. Select the name of the employee who is claiming leave.
  3. Navigate to the employee's benefits.
  4. Select Manage Leaves
  5. Click Add Leave and enter in all relevant info.
  6. Click Edit.
  7. Upload the report.
  8. We can then run a special payroll on your behalf to make sure it's correctly reported.

Part 4: Annual reporting requirements 

Please visit this Help Center article for more information on annual reporting requirements.