2002 Calendar Year Closing
Prior Year Worker's Comp Recovery
- 1) Agency receives a check from the worker's compensation
carrier, and deposits these funds into their account.
- 2) Issue a check to the employee for the total amount of the
FICA/Medicare and retirement deductions. Check is to be forwarded to the
- 3) Complete forms COP-9 and CO-1081 to begin the recovery
process. The COP-9 is to include the original gross pay and the amount of
the FICA/Medicare and retirement deductions in their appropriate boxes on
line 1. On the COP-9 the amount of check is to include the net plus Federal
and State taxes withheld.
- Form CO-1081 should reflect the total deductions being
reversed, FICA/Medicare and retirement only.
- Forms COP-9 and CO-1081 are to be forwarded to the
Payroll Services Division with a copy of the agency's deposit slip showing
the agency received the funds for reimbursement.
- 4) The Payroll Services Division will process the
reversal on the next payroll cycle. On that check date the agency will be
credited the appropriate deduction amounts.
- Payroll Services Division will also process the W-2c
adjusting the employee's taxable wage and FICA/Medicare deductions for the
appropriate tax year. The W-2c will be forwarded to the agency and should
then be forwarded to the employee. Payroll Services will report the
adjustments to the Federal and State Government.
- It is the employee's responsibility to file an amended
tax return with the IRS and the Department of Revenue Services, and if
appropriate, to receive a refund of Federal and/or State taxes.
*The IRS and D.R.S. will not accept adjustments to an
employee's tax return after 3 years.
- *If an agency submits a prior year cancellation that
includes federal and state deductions, Payroll Services will adjust the COP-9
and CO-1081 to remove the deductions. The agency will be responsible for
getting this money back from the employee.
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