What Does The W-2 Form Tell You?
A W-2 form is a wage and tax statement that reports an employee's income and taxes withheld from their paychecks. The W-2 form also provides information about other employer benefits like health insurance, adoption and dependent care assistance, health savings account contributions and more. Employees use the W-2 form to prepare their tax returns. Employers are required to send the W-2 form to employees and the IRS at the end of the year.
The W-2 form is divided into several boxes that contain important information about your income and taxes withheld. Here's what each box means:
Box 1: Wages, tips, and other compensation
This box shows your total taxable wages for the year. This includes your regular pay, bonuses, commissions, and other forms of compensation.
Box 2: Federal income tax withheld
This box shows the amount of federal income tax that was withheld from your paychecks during the year.
Box 3: Social Security wages
This box shows your total wages subject to Social Security tax. This includes your regular pay, bonuses, commissions, and other forms of compensation.
Box 4: Social Security tax withheld
This box shows the amount of Social Security tax that was withheld from your paychecks during the year.
Box 5: Medicare wages and tips
This box shows your total wages subject to Medicare tax. This includes your regular pay, bonuses, commissions, and other forms of compensation.
Box 6: Medicare tax withheld
This box shows the amount of Medicare tax that was withheld from your paychecks during the year.
Box 7: Social Security tips
This box shows the amount of tips you reported to your employer during the year.
Box 8: Allocated tips
This box shows any tips that were allocated to you by your employer.
Box 9: Blank
Box 10: Dependent care benefits
This box shows any dependent care benefits you received from your employer during the year.
Box 11: Nonqualified plans
This box shows any amounts deferred under a nonqualified deferred compensation plan.
Box 12: Codes
This box contains various codes that provide additional information about your income and benefits. For example:
Code D - Elective deferrals to a 401(k) plan.
Code E - Elective deferrals under a Section 403(b) salary reduction agreement.
Code F - Elective deferrals under a Section 408(k)(6) salary reduction SEP.
Code G - Elective deferrals and employer contributions (including non-elective deferrals) to a Section 457(b) deferred compensation plan.
Code H - Elective deferrals under a Section 501(c)(18)(D) tax-exempt organization plan.
Code J - Nontaxable sick pay.
Code K - Excise tax (equal to 20%) on excess golden parachute payments.
Code L - Substantiated employee business expense reimbursements (nontaxable).
Code M - Uncollected Social Security or RRTA tax on taxable cost of group-term life insurance over $50,000 (former employees only).
Code N - Uncollected Medicare tax on taxable cost of group-term life insurance over $50,000 (former employees only).
Code P - Excludable moving expense reimbursements paid directly to employee.
Code Q - Nontaxable combat pay.
Code R - Employer contributions to an Archer MSA.
Code S - Employee salary reduction contributions under a Section 408(p) SIMPLE plan.
Code T - Adoption benefits.
Code V - Income from exercise of nonstatutory stock option(s).
Code W - Employer contributions (including amounts the employee elected to contribute using a Section 125 cafeteria plan) to an employee's health savings account (HSA).
Code Y - Deferrals under a Section 409A nonqualified deferred compensation plan.
Box 13: Checkboxes
This box contains three checkboxes that indicate whether you are a statutory employee, participated in a retirement plan during the year, or received third-party sick pay.
Box 14: Other
This box contains any other information that your employer wants to report. For example, if you worked in multiple states during the year, this box might show how much you earned in each
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