What is Box 12a on W2? Explained for Easy Tax Filing

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. File the “X” return that is appropriate for the return on which the wages or compensation was originally reported (Forms 941-X, 943-X, 944-X, or CT-1X). Correct the social security and Medicare wages and taxes for the period during which the wages or compensation was originally paid. For information on reporting adjustments to Forms 941, 943, 944, or Form CT-1, see section 13 of Pub.

The IRS and Box 12: Compliance and Regulations

That means it’s time to get reacquainted with Form W-2 for the 2024 tax year. The W-2 you got from your employer will have four lines for box 12—labeled 12a, 12b, 12c, and 12d. You may use this box to correct an establishment number. The IRS will not use Form W-3c to update your address of record. If you wish to change your address, file Form 8822 or Form 8822-B.

• The completed Form W-2 is then sent to employees in January, and a copy is also filed with the IRS.
• This section provides information on various types of compensation you receive throughout the year.
• Also use the “944” checkbox if you filed Formulario 944 (sp), the Spanish-language version of Form 944.
• Additionally, the amounts reported in these codes may vary depending on the employee’s circumstances.

W-2 Box 12 Labels and Codes Explained

Taxpayers need to understand the significance of Box 12a because it can impact the accuracy of their tax returns. If a code is incorrectly reported or omitted from Box 12a, it can result in an incorrect tax calculation, which may lead to penalties or additional taxes owed. Form W-2 Box 12 codes are what is box 12a key to understanding your tax documents. They outline various payments and benefits, including uncollected Social Security, each with unique taxable amounts and implications. These codes significantly impact your tax return, providing valuable insights into your income and tax responsibilities.

If you also have to correct forms of employees who are not household employees, complete a separate Form W-3c. 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 these codes to show elective deferrals and designated Roth contributions made to the plans listed. See the example for reporting elective deferrals under a section 401(k) plan, later.

Retirement Contributions

These boxes are only for social security and Medicare information. If you also have employees who are subject to social security and Medicare taxes, send that group’s Forms W-2 with a separate Form W-3 and check the “941” checkbox on that Form W-3. If you made excess golden parachute payments to certain key corporate employees, report the 20% excise tax on these payments. If the excess payments are considered to be wages, report the 20% excise tax withheld as income tax withheld in box 2. Under nonqualified plans or nongovernmental 457(b) plans, deferred amounts that are no longer subject to a substantial risk of forfeiture are taxable even if not distributed.

Code K—20% excise tax on excess golden parachute payments (not applicable to Forms W-2AS, W-2CM, W-2GU, or W-2VI).

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 . 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 plan year 2025, a cafeteria plan may not allow an employee to request salary reduction contributions for a health FSA in excess of $3,300 (as indexed for inflation).

Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. Also enter your title and employer’s contact person, employer’s telephone number, employer’s fax number, and employer’s email address, if available. If you are not the employer, see Who may sign Form W-3 . Use this box to make any corrections to your previously reported state ID number.

Box 12 Codes and Explanations For Your Retirement Plan

Tax advisors can help you determine which tax forms you need to use and how to report the information from Box 12a on those forms properly. Following these steps will guarantee accurate tax filing and help you evade any possible penalties or complications with the IRS. For example, an employee who participated in a retirement plan may have deferred a portion of their salary to the plan, which would be reported in Box 12a using code D, E, or G. The amount deferred would depend on the employee’s contribution percentage and salary.

However, any uncollected Additional Medicare Tax (on the cost of group-term life insurance, which, in combination with other wages, is in excess of $200,000) is not reported with code N in box 12. Do not include an employee’s contribution in box 1, but do include it in boxes 3 and 5. (Use box 14 if railroad retirement taxes apply.) An employee’s total contribution must also be included in box 12 with code D or S. 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.

Save time with automated accounting—ideal for individuals and small businesses. Each W-2 Form Box 12 code is either a single or double letter code. The UPPER-CASE (capital) letters in box 12 report different things to the IRS.

• Advise your employee to correct the SSN and/or name on their original Form W-2.
• Report in box 12 any items that are listed as codes A through II.
• If you are not using the official IRS form to furnish Form W-2 to employees or to file with the SSA, you may use an acceptable substitute form that complies with the rules in Pub.
• Report the amount of payments and reimbursements the employee is entitled to receive under the QSEHRA for the calendar year, not the amount the employee actually receives.
• Only elective deferrals and designated Roth contributions should be reported in box 12 for all coded plans; except, when using code G for section 457(b) plans, include both elective and nonelective deferrals.

Also include designated Roth contributions to a pension-linked emergency savings account in box 12. Severance payments are wages subject to social security and Medicare taxes. 15 (Circular E), severance payments are also subject to income tax withholding and FUTA tax. You are not required to complete box 12 with code Y (Deferrals under a section 409A nonqualified deferred compensation plan).

E-filing Form W-2 is easier and more efficient, and the IRS recommends that you file electronically for quick processing of your returns. Enter all 4 digits of the year of the form you are correcting and the type of form you are correcting. For the type of form, enter “2,” “2AS,” “2CM,” “2GU,” “2VI,” “2c,” “3,” “3SS,” or “3c.” For example, entering “2023” and “2” indicates that all the forms being corrected are 2023 Forms W-2. If your only changes to the original Form W-2 are to state or local data, do not send Copy A of Form W-2c to the SSA.

If the previous reported name was reported as blanks or not available, then box g should be all blanks. Two Forms W-2 were submitted for Taylor Smith under the same EIN for the same tax year. One Form W-2 correctly reported social security wages of $20,000. The other Form W-2 incorrectly reported social security wages of $30,000, whereas $25,000 should have been reported.

For questions, contact the CNMI Division of Revenue and Taxation. Before Sam’s death on June 15, 2025, Sam was employed and received $10,000 in wages on which federal income tax of $1,500 was withheld. When Sam died, Sam’s employer owed Sam $2,000 in wages and $1,000 in accrued vacation pay. The total of $3,000 (less the social security and Medicare taxes withheld) was paid to Sam’s estate on July 20, 2025. Because Sam’s employer made the payment during the year of death, the employer must withhold social security and Medicare taxes on the $3,000 payment and must complete Form W-2 as follows. Box 12 code W on your W-2 form indicates employer contributions to your Health Savings Account (HSA).