Employee is Not Being Paid a Wellness Reimbursement

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Quoting chyvan

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Your employer is probably putting money into an HSA account. The numbers you quoted for 2016 strongly suggest this, and "no" you're not being taxed on it, yet.

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Wouldn't OP need to be on a high deductible/catastrophic health insurance plan if that were the case?

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Quoting Notxreimbursed

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i never signed up for any healthcare plan through my employer.

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He probably does and just doesn't know it. My employer enrolled everyone in the "free" policy with an HSA deduction even if an employee selected nothing. The only way to have nothing was to affirmatively reject it. The OP just says he didn't sign up for one (not that he rejected it) so I'm thinking he got it by default.

Yes. By IRS regulation, an employee cannot participate in an HSA unless he is also enrolled in a High Deductible Health plan. The poster indicated that he is not enrolled in a health plan through the employer at all.

And HSA's aren't funded by imputed income anyway. They would show as a pre-tax deduction, not as something added into the gross wages.

The numbers quoted do not even come close to "suggesting" this, let alone strongly. The 2016 HSA limit for individuals was much less than $5000 and the limit for families was over it. There is no significance to $5000 with regards to HSA's.

Did I mention that I do employee benefits for a living and deal with HSA's every working day?

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Quoting chyvan

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He probably does and just doesn't know it. My employer enrolled everyone in the "free" policy with an HSA deduction even if an employee selected nothing. The only way to have nothing was to affirmatively reject it. The OP just says he didn't sign up for one (not that he rejected it) so I'm thinking he got it by default.

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I'm thinking that for the reasons I just defined above, you're talking out of your ass again.

But if he had an HSA, he would be getting monthly statements or communications on how to spend it and what the balance is. I'd be VERY surprised if this were an HSA contribution -- only because it would generally show on a paystub the same as 401(k) Employer Match since neither are part of Gross Income calculations in any payroll system I have seen or worked with.

And the 2017 limit on HSA contributions is $3400 for a single employee (employer contributions and employee contributions combined) so $5k+ for the year to date is not reasonable. It is $6250 for employee plus family, but the OP hasnt' stated if he has HDHP family coverage. And even then I don't know many employers who fund that high of HSA balances without making sure that employees know that they are.

but again, only his Payroll can explain their paystubs and we are all guessing.

Ok, so it's not an HSA and it's the wrong term. However, for 2011's open enrollment (that I didn't get to participate in), the employer started to contribute a flat $500 per month ($6,000/yr) for whatever health plan an employee wanted. If you had the lowest plan, there was money left over that we were told could be used to cover the deductible. I thought the money was going into an HSA, and you're convincing me I'm wrong (they were new). So what are those plans called?

Depending on the specifics, that MIGHT have been an FSA, which serves a similar purpose to an HSA but with different limitations. What happened to the money if it didn't get used, chyvan?

You said that was for 2011, right? $5000 was still applicable for an FSA in 2011. Shortly after that, the limit was lowered to $2,500 and it stands today at $2,650, but in 2011 $5,000 was still okay.

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Quoting cbg

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Depending on the specifics, that MIGHT have been an FSA, which serves a similar purpose to an HSA but with different limitations. What happened to the money if it didn't get used, chyvan?

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I don't know. It was all new, and I was gone before it started and never saw how the full implementation would have looked on a pay stub, how to make requests for reimbursement or if it was lose it or lose it.

I think the OP will probably have a lot more questions than just the one he asked, and will want to talk to a benefits person rather than someone in payroll.

That's possible. We go back and forth with Payroll all the time. We can answer questions about benefit deductions; Payroll can answer questions about taxes. Since the poster indicated that it was listed as wages and was taxed however, Payroll seems like a logical place to start. I'm sure someone in Payroll will be happy (more than happy, if they're like our Payroll) to refer him to someone in Benefits if that seems to be where it is originating after they review it.

i never signed up for an HSA plan with my employer. i waived everything. the only plan i have with my company is an employer paid 15,000 life insurance policy.

So what did they tell you the notation on your pay stub is?