Preparing Form W-2 Type all entries using black ink and, if possible, in a point Courier font. Entries are read by machine. Handwritten, script, or italicized fonts and entries made in other than black ink can't be read.
Make all dollar entries without the dollar sign and comma but with the decimal point Show the cents portion or use zeroes for no cents. Don't make any erasures, cross-outs, or whiteouts. Copy A must be error free. If you make an error, put an "X" in the "Void" box, use the next Form W-2, and start again. Don't write "corrected" on the next Form W Because Form W-2 is printed with two forms on a single page, send in the whole Copy A page the page printed with red ink to the SSA even if one form is blank or void.
Instead, it reports how much the employee was paid during the year and how much tax was withheld. Every employer engaged in business must file a Form W-2 for each employee who is paid cash or non-cash compensation. There is so no matter how much pay the employee received. That is, there no minimum dollar amount that triggers this reporting obligation.
A W-2 must be filed even if the employee is related to you. For example, if you hire your spouse or child to work in your business. Form W-2 is a six-part form. The employer must file a copy of with the Social Security Administration and another with the applicable state tax agency. You must send three copies of the form to the employee. Employees who file their income taxes on paper must attach a copy of the W-2 with their return.
One copy should be maintained by the employer. The due date for filing is January 31 of each year. Completing the W-2 form can be tricky because the amount of employee wages can include amounts other than cash wages. For example, such items as non-cash compensation, dependent care assistance benefits, scholarships, employer-provided group-term life insurance, certain expense arrangements, and tips.
Payroll taxes can quickly get complicated. You have to calculate the withholding, do the necessary record keeping and fill out the required forms.
Because of this, many small business owners rely on tax pros or accountants to do it. Remember, the amounts you pay a payroll tax service are deductible business operating expenses. You can also handle payroll and taxes yourself using accounting software. Know temporary employee rules if you plan to hire somebody for seasonal work. Not following these requirements could lead to major trouble. Federal employers should withhold and report social security and Medicare taxes for these employees in the same way as for other federal employees.
For more information, go to IRS. If the H-2A visa agricultural worker furnishes a valid taxpayer identification number, report these payments in box 1 of Form W If the worker does not furnish a valid taxpayer identification number, report the payments on Form MISC.
On Form W-2, no amount should be reported in box 3 or 5. In most cases, you do not need to withhold federal income tax from compensation paid to H-2A visa agricultural workers. Employers should withhold federal income tax only if the H-2A visa agricultural worker and the employer agree to withhold.
The H-2A visa agricultural worker must provide a completed Form W If the employer withholds income tax, the employer must report the tax withheld in box 2 of Form W-2 and on line 8 of Form Include all taxable fringe benefits in box 1 of Form W-2 as wages, tips, and other compensation and, if applicable, in boxes 3 and 5 as social security and Medicare wages.
Although not required, you may include the total value of fringe benefits in box 14 or on a separate statement. However, if you provided your employee a vehicle, you must include the value of any personal use in boxes 1, 3, and 5 of Form W You must withhold social security and Medicare tax, but you have the option not to withhold federal income tax if you notify the employee and include the value of the benefit in boxes 1, 3, 5, and Public Law , section , does not permit employees to deduct unreimbursed employee business expenses for tax years through Include any golden parachute payments in boxes 1, 3, and 5 of Form W Withhold federal income, social security, and Medicare taxes or railroad retirement taxes, if applicable as usual and report them in boxes 2, 4, and 6, respectively.
Also report the excise tax in box 12 with code K. For definitions and additional information, see Regulations section 1. Federal, state, and local governmental agencies have two options for reporting their employees' wages that are subject to only Medicare tax for part of the year and both social security and Medicare taxes for part of the year.
The first option which the SSA prefers is to file a single set of Forms W-2 per employee for the entire year, even if only part of the year's wages are subject to both social security and Medicare taxes. The wages in box 5 of Form W-2 must be equal to or greater than the wages in box 3 of Form W The second option is to file one set of Forms W-2 for wages subject only to Medicare tax and another set for wages subject to both social security and Medicare taxes.
Use a separate Form W-3 to transmit each set of Forms W For the Medicare-only Forms W-2, check "Medicare govt. Use Table in Pub. Also show the amount in box 12 with code C. For employees, you must withhold social security and Medicare taxes, but not federal income tax. You are not required to collect those taxes. However, you must report the uncollected social security tax or railroad retirement taxes, if applicable with code M and the uncollected Medicare tax or RRTA Medicare tax, if applicable with code N in box 12 of Form W For more information, see Notice , I.
An employer's contribution including an employee's contributions through a cafeteria plan to an employee's HSA is not subject to federal income tax withholding or social security, Medicare, or railroad retirement taxes or FUTA tax if it is reasonable to believe at the time of the payment that the contribution will be excludable from the employee's income. However, if it is not reasonable to believe at the time of payment that the contribution will be excludable from the employee's income, employer contributions are subject to federal income tax withholding, social security and Medicare taxes or railroad retirement taxes, if applicable , and FUTA tax, and must be reported in boxes 1, 3, and 5 use box 14 if railroad retirement taxes apply ; and on Form , Employer's Annual Federal Unemployment FUTA Tax Return.
You must report all employer contributions including an employee's contributions through a cafeteria plan to an HSA in box 12 of Form W-2 with code W. Employer contributions to an HSA that are not excludable from the income of the employee must also be reported in boxes 1, 3, and 5. An employee's contributions to an HSA unless made through a cafeteria plan are includible in income as wages and are subject to federal income tax withholding and social security and Medicare taxes or railroad retirement taxes, if applicable.
Notice , I. Employers are not prohibited by the Internal Revenue Code from charging a fee for the issuance of a duplicate Form W Employers paying their employees while they are on active duty in the U.
Differential wage payments made to an individual while on active duty for periods scheduled to exceed 30 days are subject to income tax withholding, but are not subject to social security, Medicare, and unemployment taxes.
Report differential wage payments in box 1 and any federal income tax withholding in box 2. Differential wage payments made to an individual while on active duty for 30 days or less are subject to income tax withholding, social security, Medicare, and unemployment taxes and are reported in boxes 1, 3, and 5.
Effective for tax years through , the exclusion for qualified moving expense reimbursements applies only to members of the U. Armed Forces on active duty who move pursuant to a military order and incident to a permanent change of station.
All other employees have only nonqualified moving expenses and expense reimbursements subject to tax and withholding. Report qualified moving expenses for members of the Armed Forces as follows. Qualified moving expenses that an employer paid to a third party on behalf of the employee for example, to a moving company , and services that an employer furnished in kind to an employee are not reported on Form W Qualified moving expense reimbursements paid directly to an employee by an employer are reported only in box 12 of Form W-2 with code P.
Nonqualified moving expenses and expense reimbursements are reported in boxes 1, 3, and 5 use box 14 if railroad retirement taxes apply of Form W These amounts are subject to federal income tax withholding and social security and Medicare taxes or railroad retirement taxes, if applicable.
Section A provides that all amounts deferred under a nonqualified deferred compensation NQDC plan for all tax years are currently includible in gross income to the extent not subject to a substantial risk of forfeiture and not previously included in gross income, unless certain requirements are met. Generally, section A is effective with respect to amounts deferred in tax years beginning after December 31, , but deferrals made before that year may be subject to section A under some circumstances.
It is not necessary to show amounts deferred during the year under an NQDC plan subject to section A. If you report section A deferrals, show the amount in box 12 using code Y. For more information on amounts includible in gross income and reporting requirements, see Notice available at IRS.
For information on correcting failures to comply with section A and related reporting, see Notice , I. Report the amount includible in gross income from qualified equity grants under section 83 i 1 A for the calendar year in box 12 using code GG. This amount is wages for box 1 and you must withhold income tax under section i at the rate and manner prescribed in section t.
Social security and Medicare taxation of the deferral stock is not affected by these rules. QSEHRAs allow eligible employers to pay or reimburse medical care expenses of eligible employees after the employees provide proof of coverage. For information on employer reporting requirements, see Code FF—Permitted benefits under a qualified small employer health reimbursement , later.
Railroad employers must file Form W-2 to report their employees' wages and income tax withholding in boxes 1 and 2. Employers should withhold Tier 1 and Tier 2 RRTA taxes on all money remuneration that stems from the employer-employee relationship, including award payments to employees to compensate for working time lost due to an on-the-job injury and lump-sum payments made to unionized employees upon ratification of collective bargaining agreements.
Employee stock options are not "money remuneration" subject to the RRTA. Railroad employers should not withhold Tier 1 and Tier 2 taxes when employees covered by the RRTA exercise stock options. Employers should still withhold federal income tax on taxable compensation from railroad employees exercising their stock options. Check the "" checkbox on Form W-3, box b, "Kind of Payer," to transmit Forms W-2 with box 1 wages and box 2 tax withholding for employees covered by social security and Medicare.
These boxes are not to be used to report railroad retirement compensation and taxes. Railroad employers must withhold social security and Medicare taxes from taxable compensation of employees covered by social security and Medicare who are exercising their employee stock options. If an employee repays you for wages received in error, do not offset the repayments against current year wages unless the repayments are for amounts received in error in the current year.
Repayments made in the current year, but related to a prior year or years, must be repaid in gross, not net, and require special tax treatment by employees in some cases.
You may advise the employee of the total repayments made during the current year and the amount if any related to prior years. This information will help the employee account for such repayments on his or her federal income tax return.
If the repayment was for a prior year, you must file Form W-2c with the SSA to correct only social security and Medicare wages and taxes, and furnish a copy to the employee.
Do not correct "Wages, tips, other compensation" in box 1, or "Federal income tax withheld" in box 2, on Form W-2c. Also do not correct any Additional Medicare Tax withheld on the repaid wages reported with Medicare tax withheld in box 6 on Form W-2c. Correct the social security and Medicare wages and taxes for the period during which the wages or compensation was originally paid. Tell your employee that the wages paid in error in a prior year remain taxable to him or her for that year.
This is because the employee received and had use of those funds during that year. The employee is not entitled to file an amended return Form X to recover the income tax on these wages.
However, the employee is entitled to file an amended return Form X to recover Additional Medicare Tax on these wages, if any. Refer your employee to Repayments in Pub. Give a Form W-2 to each recipient of a scholarship or fellowship grant only if you are reporting amounts includible in income under section c relating to payments for teaching, research, or other services required as a condition for receiving the qualified scholarship.
Also see Pub. These payments are subject to federal income tax withholding. However, their taxability for social security and Medicare taxes or railroad retirement taxes, if applicable depends on the nature of the employment and the status of the organization.
See Students, scholars, trainees, teachers, etc. If you had employees who received sick pay in from an insurance company or other third-party payer and the third party notified you of the amount of sick pay involved, you may be required to report the information on the employees' Forms W If the insurance company or other third-party payer did not notify you in a timely manner about the sick pay payments, it must prepare Forms W-2 and W-3 for your employees showing the sick pay.
For specific reporting instructions, seesection 6 of Pub. An employee's salary reduction contributions to a SIMPLE savings incentive match plan for employees retirement account are not subject to federal income tax withholding but are subject to social security, Medicare, and railroad retirement taxes. Do not include an employee's contribution in box 1, but do include it in boxes 3 and 5. An employee's total contribution must also be included in box 12 with code D or S.
An employer's matching or nonelective contribution to an employee's SIMPLE retirement account is not subject to federal income tax withholding or social security, Medicare, or railroad retirement taxes, and is not to be shown on Form W If you buy or sell a business during the year, see Rev. If you terminate your business, you must provide Forms W-2 to your employees for the calendar year of termination by the due date of your final Form , , or SS.
If filing on paper, make sure you obtain Forms W-2 and W-3 preprinted with the correct year. If e-filing, make sure your software has been updated for the current tax year. Also, for information on automatic extensions for furnishing Forms W-2 to employees and filing Forms W-2, see Rev. If an employee returned to your employment after military service and certain make-up amounts were contributed to a pension plan for a prior year s under the USERRA, report the prior year contributions separately in box You may also report certain make-up amounts in box Instead of reporting in box 12 or box 14 , you may choose to provide a separate statement to your employee showing USERRA make-up contributions.
The statement must identify the type of plan, the year s to which the contributions relate, and the amount contributed for each year.
For federal tax purposes, virtual currency is treated as property. Bitcoin is an example of virtual currency. Transactions using virtual currency such as Bitcoin must be reported in U. For more information about how virtual currency is treated for federal income tax purposes, including W-2 requirements, see Notice , I. The following penalties apply to the person or employer required to file Form W The penalties apply to both paper filers and e-filers.
Employers are responsible for ensuring that Forms W-2 are furnished to employees and that Forms W-2 and W-3 are filed with the SSA correctly and on time, even if the employer contracts with a third party to perform these acts. The IRS strongly suggests that the employer's address, not the third party's address, be the address on record with the IRS. This will ensure that you remain informed of tax matters involving your business because the IRS will correspond to the employer's address of record if there are any issues with an account.
If you choose to outsource any of your payroll and related tax duties that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes to a third-party payer, go to IRS. If you fail to file a correct Form W-2 by the due date and cannot show reasonable cause, you may be subject to a penalty as provided under section The penalty applies if you:.
File on paper forms when you are required to e-file ,. The amount of the penalty is based on when you file the correct Form W Penalties are indexed for inflation. The penalty amounts shown below apply to filings due after December 31, The penalty is:. The following are exceptions to the failure to file correct information returns penalty. The penalty will not apply to any failure that you can show was due to reasonable cause and not to willful neglect.
In general, you must be able to show that your failure was due to an event beyond your control or due to significant mitigating factors. You must also be able to show that you acted in a responsible manner and took steps to avoid the failure. An inconsequential error or omission is not considered a failure to include correct information.
Errors and omissions that are never inconsequential are those relating to:. De minimis rule for corrections. Even though you cannot show reasonable cause, the penalty for failure to file correct Forms W-2 will not apply to a certain number of returns if you:.
Either failed to include all of the information required on the form or included incorrect information, and. Forms W-2 issued with incorrect dollar amounts may fall under a safe harbor for certain de minimis errors. If the safe harbor applies, you will not have to correct the Form W-2 to avoid penalties. However, if the payee elects for the safe harbor not to apply, you may have to issue a corrected return to avoid penalties. If you fail to provide correct payee statements Forms W-2 to your employees and cannot show reasonable cause, you may be subject to a penalty as provided under section The penalty applies if you fail to provide the statement by January 31, , if you fail to include all information required to be shown on the statement, or if you include incorrect information on the statement.
The amount of the penalty is based on when you furnish the correct payee statement. This penalty is an additional penalty and is applied in the same manner, and with the same amounts, as in Failure to file correct information returns by the due date. An inconsequential error or omission is an error that cannot reasonably be expected to prevent or hinder the payee from timely receiving correct information and reporting it on his or her income tax return or from otherwise putting the statement to its intended use.
The appropriate form for the information provided, such as whether the form is an acceptable substitute for the official IRS form. See Exceptions to the penalty under Failure to file correct information returns by the due date , for additional exceptions to the penalty for failure to furnish correct payee statements. If you willfully file a fraudulent Form W-2 for payments that you claim you made to another person, that person may be able to sue you for damages.
You may also be subject to criminal sanctions. Form W-2 is a multi-part form. Ensure all copies are legible. Do not print Forms W-2 Copy A on double-sided paper. Keep Copy D, and a copy of Form W-3, with your records for 4 years.
Enter the information on Form W-2 using black ink in point Courier font. Copy A is read by machine and must be typed clearly with no corrections made to the entries and with no entries exceeding the size of the boxes. Entries completed by hand, in script or italic fonts, or in colors other than black cannot be read by the machines. Make all dollar entries on Copy A without the dollar sign and comma but with the decimal point Show the cents portion of the money amounts. If a box does not apply, leave it blank.
Do not staple Forms W-2 together or to Form W The entries on Form W-2 must be based on wages paid during the calendar year. Use Form W-2 for the correct tax year. For example, if the employee worked from December 19, , through January 1, , and the wages for that period were paid on January 4, , include those wages on the Form W If necessary, you can issue more than one Form W-2 to an employee.
For example, you may need to report more than four coded items in box 12 or you may want to report other compensation on a second form. If you issue a second Form W-2, complete boxes a, b, c, d, e, and f with the same information as on the first Form W Show any items that were not included on the first Form W-2 in the appropriate boxes.
For each Form W-2 showing an amount in box 3 or 7, make certain that box 5 equals or exceeds the sum of boxes 3 and 7. Check this box when an error is made on Form W-2 and you are voiding it because you are going to complete a new Form W Do not include any amounts shown on "Void" forms in the totals you enter on Form W See Corrections. Enter the number shown on the employee's social security card. If you have questions about using these services, call toll free to speak with an employer reporting technician at the SSA.
If the employee has applied for a card but the number is not received in time for filing, enter "Applied For" in box a on paper Forms W-2 filed with the SSA. If e-filing, enter zeros if creating forms online or if uploading a file. Ask the employee to inform you of the number and name as they are shown on the social security card when it is received. If the employee needs to change his or her name from that shown on the card, the employee should call the SSA at If you do not provide the correct employee name and SSN on Form W-2, you may owe a penalty unless you have reasonable cause.
Do not auto populate an ITIN into box a. Do not truncate your EIN. Do not use a prior owner's EIN. Also see Agent reporting. Postal Service recommends that no commas or periods be used in return addresses. You may use this box to identify individual Forms W You do not have to use this box. Enter the name as shown on your employee's social security card first name, middle initial, last name.
If the name does not fit in the space allowed on the form, you may show the first and middle name initials and the full last name. It is especially important to report the exact last name of the employee.
Separate parts of a compound name with either a hyphen or a blank space. Do not join them into a single word. Include all parts of a compound name in the appropriate name field. If the name has changed, the employee must get a corrected social security card from any SSA office.
Use the name on the original card until you see the corrected card. Do not show titles or academic degrees, such as "Dr. Generally, do not enter "Jr. Include in the address the number, street, and apartment or suite number or P. Postal Service recommends that no commas or periods be used in delivery addresses. For a foreign address, give the information in the following order: city, province or state, and country. Follow the country's practice for entering the postal code. Do not abbreviate the country name.
Show the total taxable wages, tips, and other compensation that you paid to your employee during the year. However, do not include elective deferrals such as employee contributions to a section k or b plan except section c 18 contributions. Include the following. Total wages, bonuses including signing bonuses , prizes, and awards paid to employees during the year. See Calendar year basis. Total noncash payments, including certain fringe benefits.
See Fringe benefits. Total tips reported by the employee to the employer not allocated tips. Certain employee business expense reimbursements. See Employee business expense reimbursements. Taxable benefits from a section cafeteria plan if the employee chooses cash. Employer contributions to an Archer MSA if includible in the income of the employee. See Archer MSA. Employer contributions for qualified long-term care services to the extent that such coverage is provided through a flexible spending or similar arrangement.
See Group-term life insurance. Unless excludable under Educational assistance programs , payments for non-job-related education expenses or for payments under a nonaccountable plan. The amount includible as wages because you paid your employee's share of social security and Medicare taxes or railroad retirement taxes, if applicable. See Employee's social security and Medicare taxes or railroad retirement taxes, if applicable paid by employer. If you also paid your employee's income tax withholding, treat the grossed-up amount of that withholding as supplemental wages and report those wages in boxes 1, 3, 5, and 7.
No exceptions to this treatment apply to household or agricultural wages. Designated Roth contributions made under a section k plan, a section b salary reduction agreement, or a governmental section b plan.
See Designated Roth contributions. Distributions to an employee or former employee from an NQDC plan including a rabbi trust or a nongovernmental section b plan. Amounts includible in income under section f because the amounts are no longer subject to a substantial risk of forfeiture.
Payments to statutory employees who are subject to social security and Medicare taxes but not subject to federal income tax withholding must be shown in box 1 as other compensation.
See Statutory employee. Cost of current insurance protection under a compensatory split-dollar life insurance arrangement. Employer contributions to an HSA if includible in the income of the employee. See Health savings account HSA. Amounts includible in income under section A from an NQDC because the amounts are no longer subject to a substantial risk of forfeiture and were not previously included in income.
Nonqualified moving expenses and expense reimbursements. See Moving expenses. Payments made to former employees while they are on active duty in the U. Armed Forces or other uniformed services. All other compensation, including certain scholarship and fellowship grants. See Scholarship and fellowship grants. Other compensation includes taxable amounts that you paid to your employee from which federal income tax was not withheld.
You may show other compensation on a separate Form W See Multiple forms. Show the total federal income tax withheld from the employee's wages for the year. See Golden parachute payments. Virgin Islands income tax withheld. Show the total wages paid before payroll deductions subject to employee social security tax but not including social security tips and allocated tips.
If reporting these amounts in a subsequent year due to lapse of risk of forfeiture , the amount must be adjusted by any gain or loss. See Box 7—Social security tips and Box 8—Allocated tips. Generally, noncash payments are considered to be wages. Include employee business expense reimbursements and moving expenses reported in box 1. If you paid the employee's share of social security and Medicare taxes rather than deducting them from wages, see Employee's social security and Medicare taxes or railroad retirement taxes, if applicable paid by employer.
Report in box 3 elective deferrals to certain qualified cash or deferred compensation arrangements and to retirement plans described in box 12 codes D, E, F, G, and S even though the deferrals are not includible in box 1. Also report in box 3 designated Roth contributions made under a section k plan, under a section b salary reduction agreement, or under a governmental section b plan described in box 12 codes AA, BB, and EE.
Include both elective and nonelective deferrals for purposes of nongovernmental section b plans. Signing bonuses an employer pays for signing or ratifying an employment contract. However, do not include employee contributions to an HSA that were made through a cafeteria plan.
Adoption benefits. See Adoption benefits. Show the total employee social security tax not your share withheld, including social security tax on tips. Include only taxes withheld or paid by you for the employee for wages and tips. If you paid your employee's share, see Employee's social security and Medicare taxes or railroad retirement taxes, if applicable paid by employer.
The wages and tips subject to Medicare tax are the same as those subject to social security tax boxes 3 and 7 except that there is no wage base limit for Medicare tax. Enter the total Medicare wages and tips in box 5. Be sure to enter tips that the employee reported even if you did not have enough employee funds to collect the Medicare tax for those tips.
See Box 3—Social security wages for payments to report in this box. If you paid your employee's share of taxes, see Employee's social security and Medicare taxes or railroad retirement taxes, if applicable paid by employer. If you are a federal, state, or local governmental agency with employees paying only Medicare tax, enter the Medicare wages in this box.
See Government employers. Enter in box 3 social security wages There is no limit on the amount reported in box 5. Enter the total employee Medicare tax including any Additional Medicare Tax withheld. Do not include your share. Include only tax withheld for wages and tips. If you paid your employee's share of the taxes, see Employee's social security and Medicare taxes or railroad retirement taxes, if applicable paid by employer.
Show the tips that the employee reported to you even if you did not have enough employee funds to collect the social security tax for the tips. Report all tips in box 1 along with wages and other compensation. Also include any tips reported in box 7 in box 5.
If you operate a large food or beverage establishment, show the tips allocated to the employee. Do not include this amount in box 1, 3, 5, or 7. Show the total dependent care benefits under a dependent care assistance program section paid or incurred by you for your employee.
Include the fair market value FMV of care in a daycare facility provided or sponsored by you for your employee and amounts paid or incurred for dependent care assistance in a section cafeteria plan. This may include a the FMV of benefits provided in kind by the employer, b an amount paid directly to a daycare facility by the employer or reimbursed to the employee to subsidize the benefit, or c benefits from the pre-tax contributions made by the employee under a section dependent care flexible spending account.
An employer that amends its cafeteria plan to provide a grace period for dependent care assistance may continue to rely on Notice by reporting in box 10 the salary reduction amount elected by the employee for the year for dependent care assistance plus any employer matching contributions attributable to dependent care.
The SSA uses this information to verify that they have properly applied the social security earnings test and paid the correct amount of benefits.
Report distributions to an employee from a nonqualified plan or nongovernmental section b plan in box Also report these distributions in box 1. Make only one entry in this box. Distributions from governmental section b plans must be reported on Form R, not in box 1 of Form W Under nonqualified plans or nongovernmental b plans, deferred amounts that are no longer subject to a substantial risk of forfeiture are taxable even if not distributed.
Report these amounts in boxes 3 up to the social security wage base and 5. However, do not file Form SSA if this situation applies and the employee was not 61 years old or more during the tax year for which you are filing Form W Unlike qualified plans, NQDC plans do not meet the qualification requirements for tax-favored status for this purpose.
NQDC plans include those arrangements traditionally viewed as deferring the receipt of current compensation. Accordingly, welfare benefit plans, stock option plans, and plans providing dismissal pay, termination pay, or early retirement pay are generally not NQDC plans. Military employers must report military retirement payments on Form R. Do not report special wage payments, such as accumulated sick pay or vacation pay, in box For more information on reporting special wage payments, see Pub.
Complete and code this box for all items described below. Note that the codes do not relate to where they should be entered in boxes 12a through 12d on Form W For example, if you are only required to report code D in box 12, you can enter code D and the amount in box 12a of Form W Report in box 12 any items that are listed as codes A through HH. Do not report in box 12 section h 2 contributions relating to certain state or local government plans. Instead, use box 14 for these items and any other information that you wish to give to your employee.
For example, union dues and uniform payments may be reported in box On Copy A Form W-2 , do not enter more than four items in box If more than four items need to be reported in box 12, use a separate Form W-2 to report the additional items but enter no more than four items on each Copy A Form W Use the IRS code designated below for the item you are entering, followed by the dollar amount for that item.
Even if only one item is entered, you must use the IRS code designated for that item. Enter the code using a capital letter s. Use decimal points but not dollar signs or commas. Report the IRS code to the left of the vertical line in boxes 12a through 12d and the money amount to the right of the vertical line.
Show the employee social security or Railroad Retirement Tax Act RRTA tax on all of the employee's tips that you could not collect because the employee did not have enough funds from which to deduct it.
Do not include this amount in box 4. Show the employee Medicare tax or RRTA Medicare tax on tips that you could not collect because the employee did not have enough funds from which to deduct it.
Do not show any uncollected Additional Medicare Tax. Do not include this amount in box 6. Also include this amount in boxes 1, 3 up to the social security wage base , and 5. Include the amount in box 14 if you are a railroad employer. Use these codes to show elective deferrals and designated Roth contributions made to the plans listed.
Do not report amounts for other types of plans. See the example for reporting elective deferrals under a section k plan, later. The amount reported as elective deferrals and designated Roth contributions is only the part of the employee's salary or other compensation that he or she did not receive because of the deferrals or designated Roth contributions.
Only elective deferrals and designated Roth contributions should be reported in box 12 for all coded plans; except, when using code G for section b plans, include both elective and nonelective deferrals. If any elective deferrals, salary reduction amounts, or nonelective contributions under a section b plan during the year are make-up amounts under the Uniformed Services Employment and Reemployment Rights Act of USERRA for a prior year, you must enter the prior year contributions separately.
Beginning with the earliest year, enter the code, the year, and the amount. D 19 Report the code and year for prior year USERRA contributions to the left of the vertical line in boxes 12a through 12d. The following are not elective deferrals and may be reported in box 14, but not in box After-tax contributions that are not designated Roth contributions, such as voluntary contributions to a pension plan that are deducted from an employee's pay.
See the box 12 instructions for Code AA—Designated Roth contributions under a section k plan , Code BB—Designated Roth contributions under a section b plan , and Code EE—Designated Roth contributions under a governmental section b plan for reporting designated Roth contributions. Example of reporting excess elective deferrals and designated Roth contributions under a section k plan. The amount deferred in excess of the limit is not reported in box 1.
The return of excess elective deferrals and excess designated Roth contributions, including earnings on both, is reported on Form R. Do not report either section b or section f amounts that are subject to a substantial risk of forfeiture. Be sure to include this amount in box 1 as wages. The employee will deduct the amount on his or her Form or SR. Show any sick pay that was paid by a third party and was not includible in income and not shown in boxes 1, 3, and 5 because the employee contributed to the sick pay plan.
Do not include nontaxable disability payments made directly by a state. Use this code only if you reimbursed your employee for employee business expenses using a per diem or mileage allowance and the amount that you reimbursed exceeds the amount treated as substantiated under IRS rules.
Report in box 12 only the amount treated as substantiated such as the nontaxable part. Include in boxes 1, 3 up to the social security wage base , and 5 the part of the reimbursement that is more than the amount treated as substantiated.
Report the unsubstantiated amounts in box 14 if you are a railroad employer. Also see Group-term life insurance. The exclusion for qualified moving expense reimbursements applies only to members of the U. Show the total moving expense reimbursements that you paid directly to your employee for qualified allowable moving expenses.
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