2023 Imputed Income Worksheet Now Available

If your cooperative offers group term life insurance, you must report imputed income on employees’
W-2 forms. Co-ops that do not receive this service from their payroll provider or other vendor may use resources now available on the Employee Benefits website to perform this task.

The life insurance imputed income worksheet for 2023 is now available. Use the new 2023 worksheet if you plan to impute income for each pay period throughout 2023. If you report imputed income once at the end of the year, use the 2022 worksheet.

Employers must calculate and report imputed income for the taxable value of group term life insurance above an employee’s first $50,000 of coverage (including supplemental, spouse, and child life coverage). Even though employees don’t receive cash, they must be taxed on the value of this additional coverage. Internal Revenue Code §79 contains the rules and rates.

Frequently asked questions are available on the imputed income page of the BA Guide, and an Imputed Income Worksheet Tutorial is also available on the Webinars & Videos > Compliance page of the Employee Benefits website. The tutorial gives step by step instructions for how to use the worksheets, whether you report throughout the year or all at once. 

These tools can help you with your calculations, but they are not intended as tax or legal advice. Consult your co-op’s tax advisor or legal counsel to confirm your co-op’s imputed income reporting requirements. 

If you have any questions about imputed income, contact the group compliance team at 866.673.2299, option 7, or group.compliance@nreca.coop.