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W2 box 3 You must file Form 4137 with your income tax return to report at least the allocated tip amount unless you can prove with adequate records that you received a smaller amount. Apr 2, 2025 · Confused by the boxes on your W-2? Learn how to read your W-2 form line by line for the 2024 tax year. It will be updated annually. Mar 27, 2025 · SSA uses your gross earnings SUBJECT TO SOCIAL SECURITY TAX to determine if you've exceeded the earnings limit. For most employees, the difference between Box 1 and Boxes 3, 5 is the amount of pre tax retirement (TIAA) contributions made. This figure is calculated before any payroll deductions which means that the amount in box 3 could be higher than the number reported in box 1, as in my example. Each box corresponds to specific information you will need to enter on your 1040 form. This differs from your Gross Earnings because there are certain deductions that reduce your Social Security taxable wages such as the pre-tax medical/dental insurances, pre-tax parking deduction, FSA Medical and Dependent Care. The net amount of this calculation should equal the taxable wages reported on your W-2 for social security (box 3) and Medicare (box 5). To calculate social security wages, begin by identifying your total earnings on your W-2 form. IV. This includes most types of wages and tips, but it excludes certain types of income, such as earnings from self-employment and investment income. This is because the pre-tax deductions are not considered in Boxes 3 and 5. Box 2: Federal income tax withheld. This differs from your Gross Earnings because there are certain deductions that reduce your Social Security taxable wages, such as the pre-tax medical/dental and vision insurance, and FSA Medical and Dependent Care. NOTE: If your box 3 amount differs from box 5 please refer to the following FAQ: "If social security and Medicare taxable wages are calculated the same, why are the amounts in boxes 3 and 5 on my W-2 Apr 17, 2025 · While Form W-2 can be overwhelming at first glance, once you break down what each box is for and how they relate to each other (and your tax refund), it gets a lot easier. So if Box 1 shows $62,500, that means your taxable income was $62,500, and from that amount, $7,200 was withheld for federal taxes (shown in Box 2). But I'm really confused about two things on my W2: 1. If you did not receive your Form W-2 or prefer an electronic version, you can access them on Cal Employee Connect under the W-2 tab. Information about Form W-2, Wage and Tax Statement, including recent updates, related forms and instructions on how to file. There are multiple income boxes on a W-2. W-2 Instructions – Understanding the W-2 form is essential to understanding tax obligations, both on the employee side as you prepare to file your annual income tax paperwork and on the employer side as you finalize your payroll for the year. Payroll biweekly cycle time periods covered in the 2024 tax year began Dec. Jun 5, 2019 · Boxes 1 & 3 (and 5 too) will not necessarily have the same figures. Employee's contribution through a cafeteria plan that is believed to be excluded from income should not appear in box 1, 3, nor 5 of the W2. How to Use the AGI from W-2 Calculator To use the AGI from W-2 Calculator, input the following details as found on your W-2 form into the respective fields: Salary (W-2 Box 1): Your total taxable wages, tips, and other compensation. Understanding the differences between Boxes 1, 3, and 5 on a W-2 form is crucial for accurate tax filing. Sep 26, 2023 · To calculate W-2 wages from a paystub, get the values for gross pay, pre-tax deductions, non-taxable income, and annual tax withholding. If you’re confused about what’s reported in Box 14 on your W-2, you can contact your employer or the issuer of your W-2 form and request an explanation. Why is Box 1 and Box 16 different on my W-2? Some employees may see a difference between Box 1 Federal Wages and Box 16 State Wages due to the value of certain pre-tax transportation benefits. There is an annual ceiling on this amount. Box 13 "Third-party Sick Pay" was checked. Box 2: Federal income tax withheld from your earnings. This amount is not included in box 1, 3, 5, or 7. Apr 11, 2025 · Box 1 on your W2 shows your taxable wages, tips, and other compensation AFTER certain pre-tax deductions have been taken out. Contact your employer for either an explanation of why there are no SS wages or taxes withheld or to get a corrected W-2. If you found this video Feb 1, 2021 · I am struggle to imagine why your 2019 W-2 would show $145k in box 1 and $80k in box 3 - did I understand you correctly? There can be a number of differences between the box 1 and box 3 amounts. Jan 18, 2017 · Box 5: Medicare wages and tips Like Box 3, income calculations for Medicare tax purposes are different from Box 1 calculations. Pre-tax contributions to a 401k or 403b will not show in Box 1 but will be in Box 3 and 5 amounts. Dec 2, 2024 · Example Form W-2 Box 1 “discrepancy” Take a look at this example Form W-2. (which shouldn't impact how much salary the employer pays to the employee). That's common! Your final pay stub may not match your W2. Internal Revenue Service | An official website of the United Jan 6, 2025 · Form W-2 Boxes Box a - Employee's Social Security Number This is the number that is being used to file your employee's taxes. Box b - Employer Identification Number (EIN) The Employer Identification Number is assigned to you by the IRS and should be the same number that you use on your federal employment tax returns (e. In this article, we’ll discuss the different W-2 boxes you’ll find on the form, explain what each one represents, and discuss how to complete them accurately. Most of these questions focus on understanding the amounts in the numbered boxes on the W-2. Your wages are not subject to income tax withholding (there will be a zero or blank amount in Box 2), but are subject to Social Security and Medicare tax withholdings (so Boxes 3 through 6 will be filled out). You are required to submit the IRS Form W-2 with your 2024 federal, state and Jun 6, 2019 · Box 1 would show $24,500 since $5,500 is not being taxed. Understanding your W-2Box 1: Wages, tips, and other compensation. This difference in gross earnings and taxable earnings on the W-2 form can be attributed to the contributions and deductions taken throughout the year by each employee. If your refund seems extremely off, you can double-check the amounts you entered. If you find that after making these adjustments to your Gross Pay YTD per your final pay stub, the result does not match Box 3 Social Security Wages and Box 5 Medicare Wages on your W-2, call Central Payroll, 617-495-8500, option 4 for assistance. Generally, box 3 reports the amount of wages subject to Social Security tax, and box 4 shows the corresponding tax withheld. Boxes 3 and 5 would show the full $30,000 since your total wages are subject to Social Security and Medicare Taxes. Social Security Wages (W-2 Box 3): The total wages subject to Mark’s wages for the year reflected in box 1 of his W-2 form are brought down to $49,000 and to $52,000 in boxes 3 and 5. Your 401k contributions must be reflected on your Form W-2 (if they are an employee deferral). Two essential aspects of a W-2 are the earnings in Box 1 and Social Security earnings in Box 3. Here's what you need to know for the current tax season. Box 3 is the amount of income subject to Social Security tax. That's Box 3 (Social Security wages) on your W-2. However, unlike Social Security, there's no upper limit on Medicare . Only those boxes and codes used at IU are defined below: Box 1 - Wages, tips and other Feb 5, 2019 · W-2 Box 1 is the amount of pay subject to income tax. See full list on hrblock. These amounts are included in Box 14 for informational purposes. Your employer should label each item listed in Box 14. As far as I know I have not had any pretax deductions(I opted out Apr 4, 2025 · Form W-2 is a record of your annual wages and how much tax you paid on them. Feb 12, 2025 · Learn how to calculate Gross Income from W2 forms with our step-by-step guide. Box 12 code was J with the payment amount. In the previous year, for the same employer, the amounts in those boxes were the same. Box 1 reports your total taxable wages or salary for federal income tax purposes. Looking at my W-2 now, I noticed in Box 7 (Social Security tips) it shows $168,600, which I understand is the cap. 14, 2024. What is the reason for this? Does the social security have a cap amount? Thank You. Jan 30, 2021 · Social Security wages should be in box 3 and the Social Security Taxes withheld should be in box 4 of the W-2. Mar 7, 2025 · Locating Social Security Wages on Your W-2 The answer to how to find Social Security wages on W-2 is that your Social Security tax withholding is reported in Box 3 of your W-2 form, as provided by your employer. Oct 20, 2025 · Why Are Boxes 3-6 Empty? After inputting the wages in box 1 of Form W-2, you may notice that amounts were auto-populated in boxes 3-6, but the W-2 has no amounts in boxes 3-6. What's confusing me is that Box 3 (Social Security wages) is completely How do I read my W-2 form? Your W-2 has several boxes with specific information. Know how to fill out Form W-2 for the 2025 tax year. Numbered Boxes on W-2 form: Box 1: Wages, tips, other compensation. Understanding this is important for accurately determining your taxable income and ensuring you’re on top of your tax obligations. Dec 2, 2024 · If you're an employer, familiarizing yourself with Form W-2 information is essential. Feb 26, 2025 · W-2 forms play a crucial role in tax reporting; thus, it’s crucial to know how to fill out W-2 boxes accurately to avoid any misunderstandings or delays. Box 1 was filled with the settlement payment, but Box 3 and 5 were left blank. Jan 7, 2025 · Learn what gross income on your W-2 means, how it differs from your pay stub, and why pre-tax deductions affect your reported taxable wages. Discover everything about W2 forms, including how to obtain, use, and correct them. If box 3 is blank and box 4 is also empty, it could indicate one of several scenarios. However, these contributions are subject to Social Security and Medicare taxes. This amount may be adjusted based on deductions, credits, or other factors when you file your tax return. Box 3 and Box 5 have completely different amounts - we're talking about a $32,000 difference between Aug 10, 2022 · Answer: Box 3 - Social Security Wages: The SSA uses the amount reported in Box 3 of the W-2 form, which reflects the wages subject to Social Security taxes. The value in Box 1 is lower than the values in Boxes 3 and 5. com Apr 8, 2024 · What is Box 3 (Social Security Wages)? Box 3 reports the employee’s total earnings that are subject to Social Security tax. However my Box 3 (social security wages), Box 4 (SS tax withheld), Box 5 (Medicare wages), Box 6 (Medicare tax withheld) all have amounts in them. The most common questions relate to why W-2 Wages differ from your final pay stub for the year, and why Social Security and Medicare Wages per the W-2 differ from your W-2 Federal wages. If you receive benefits or bonuses, that affects things. Gross wages Jan 21, 2025 · In January 2024 we made a payroll liability adjustment for taxable life insurance from 0. Understand each section before filing in 2025. Key boxes to note include: Box 1 shows your total taxable wages, Box 2 shows federal income tax withheld, Box 16 shows state wages, and Box 17 shows state income tax withheld. This form includes numerous boxes with designated purposes. Understanding Your W-2 Box 1 - Wages, tips, and other compensation l income tax purposes. Mar 26, 2025 · One question that often arises is whether Box 1 on the W-2 form reflects net or gross wages. They look at the amount of your wages before any deductions for taxes, insurance, retirement contributions, etc. In this article, we'll dive into what FICA tax is, why it's important, and how it impacts you as an employee. Explanation of Boxes Box 1 - Wages, Tips, Other Compensation This is the taxable amount reported to the Internal Revenue Service (IRS). Answer: Even if you have no taxable earnings or withholding, you will receive a Form W-2 if you paid either occupational privilege tax (OPT) or local services tax (LST). This would reduce the amount in Box 1 by the salary deferral. Box 1 does not include any pre-tax benefits The W-2 Box 3 amount is taxable wages subject to Social Security taxes. For example, some wages are subject to federal income tax but not to Social Security and Medicare taxes, and vice versa. Jan 1, 2018 · Compliance Fiscal Officer Compliance and Controls Standard Operating Procedures Tax 3. The wages in box 5 of Form W-2 must be equal to or greater than the wages in box 3 of Form W-2. Understand each box's meaning to confidently navigate your tax filing process. They can use the screen sharing tool to guide you through the steps and help you get back to business in no time. This figure represents your income (wages, salary, bonuses, and other taxable compensation) minus tax-deferred retirement plans and certain pre-tax deductions such as medical, dental, vision, and f Unlock the mysteries of W-2 box 14 codes! Discover what employers can report in this catch-all section of your Form W-2 and learn hidden tax secrets today. Jan 17, 2025 · We report to the IRS your total taxable wages and other compensation we paid to you on behalf of your employing agency during the 2024 tax year. For information on how to report tips on your tax return, see the Form 1040 instructions. Form W-2 is a summary of the taxable earnings received in a calendar year. This figure includes your wages, salary, tips reported, bonuses and other taxable compensation. Most commonly, you'll see Box 3 greater than Box 1, which is -- as you thought -- a result of subtracting pre-tax items such as retirement plan deferrals. This amount determines how much of your income is subject to Social Security tax, which directly impacts your future benefits. With more and more businesses moving to online payroll, it is important to know how to access W-2 forms (online and offline) and read a W-2 correctly May 31, 2019 · Does BOX 1,3, and 5 amount should be reported after subtracting employee contribution for 401K and HSA? Also, Does BOX 14 sould include both employee and employer contribution towards health plan? Do you have to file? Refer to the Form 1040 instructions to determine if you are required to file a tax return. Here's how: Feb 10, 2025 · Wages and Tax Withholdings Box 1: Total wages, tips, bonuses, and other taxable compensation. Earned income tax credit (EITC). Box 6: Medicare tax withheld. Form W-2 is filed by employers to report wages, tips, and other compensation paid to employees as well as FICA and withheld income taxes. Question: I retired this year and received annuity payments. Nontaxable wages include business expenses offered under an IRS-approved plan, such as lodging, meal and mileage reimbursements Means that you report the wages from this W-2 (and any other W-2 forms marked “statutory employee”) on Form 1040 Schedule C. For example for calendar year 2022, the payroll consists of pay issued from January 1, 2022 to December 31, 2022. Is this normal? Boxes 1 and 2 have numbers in them, but boxes 3-6 are blank. Locate box 1 that shows “Wages, Tips, and Other Compensation. You may be able to take the EITC for 2025 if your adjusted gross income (AGI) is less than a certain amount Jan 10, 2023 · So, you've gotten your tax paperwork and noticed that your W2 wages are lower than your yearly salary. Your W-2 Wage and Tax Statement itemizes your total annual wages and the amount of taxes withheld from your paycheck. [back to A W-2 with box 3 left empty and no Social Security tax withheld raises several important considerations regarding its accuracy. On the employee's Form W-2, show the payment as social security wages (box 3) and Medicare wages and tips (box 5) and the social security and Medicare taxes withheld in boxes 4 and 6. Last year was really good to me - I pulled in about $400,000 total. Feb 8, 2025 · Hello, On my W2 in question, box 1 (wages) is $6,063 more than box 3 (social security wages). Jun 3, 2019 · On my w-2 should box 1,3,5 all be the same $ amount?Certain tax-advantaged items such as employer HSA contributions and health insurance premiums are removed from boxes 1, 3, and 5 on the W-2 before it is even printed, because they are not subject to either federal income tax, Social Security tax, nor Medicare tax. The W-2 Box 3 amount represents taxable wages subject to Social Security taxes; this differs from your Gross Earnings because certain deductions reduce your Social Security taxable wages, such as the pre-tax medical/dental and vision insurance, pre-tax parking deduction, FSA Medical, and Dependent Care. Apr 11, 2025 · Box 3 on your W2 shows your "Social Security wages," which is the amount of your income that's subject to Social Security tax. Learn more in our guide! Feb 13, 2025 · Demystify your W-2 with our comprehensive guide. It's not easy to figure out how much salary you earned from a W-2 for a variety of reasons. To make matters more complex, the amounts shown for Social Security (Box 3) or Medicare (Box 5) will be reduced by Pre-Tax deductions only. Dec 26, 2024 · Learn how to read a W-2 form, understand income, taxes, and deductions, and make sense of your tax documents for accurate filing. Box 3 & 5 (Social Security and Medicare wages) – This Quick Overview of W-2 Boxes and Instructions Accurately filling out your W-2 is crucial to avoid penalties resulting from incomplete or incorrect information. Should I ignore box 1 number and use box 3 number instead for Form 1120S Line 8? The wages in box 5 of Form W-2 must be equal to or greater than the wages in box 3 of Form W-2. You may be able to take the EITC for 2025 if your adjusted gross income (AGI) is less than a certain amount Oct 10, 2023 · Why is W2 box 1 less than box 3? If an employee elected to contribute to a pre-tax retirement plan, their W-2 Box 1 wages are likely lower than their Box 3 wages. This is common if the taxpayer is employed by an agency that has their own private Social Security and Medicare system (churches, colleges, railroad, etc. 83 to -0-. Box 2 shows how much federal income tax was withheld from your pay throughout the year. 2) The amount from Box 12 (a) Code D should be entered under Deductions >> Retirement plan contributions. But Box 1 can also be greater than Box 3, since Box 3 (social security wages) is capped at $118,500 of income (for 2016). Learn to complete each box correctly and streamline your tax reporting process. Jun 6, 2019 · Box 3-6 are empty on my W2. Dec 7, 2021 · Changes to tax year 2021 Form W-2 mean that accountants, bookkeepers and tax preparers need to become familiar with the new form to answer client questions. Dec 6, 2024 · If Box 3 shows an amount over $168,600, you will need to have your employer correct your W-2. This will show up in Box 12 of your W-2. This example Form W-2 shows that the employee contributed to a pre-tax retirement plan, reducing their taxable wages. TaxSlayer will generate a Form 4852, Substitute for Form W-2, Wage and Tax Statement. Question: Is there a simple explanation for what is in each box of my W-2? Answer: Here is a brief explanation of what is in each box. Do you know how to fill out Form W-2? How do I determine my taxable income from my W-2 form? To determine your taxable income, you should look at Box 1 of your W-2 form, which reflects your total wages, tips, and other compensation subject to federal income tax. Any taxable fringe benefits (such as group term life insurance) are also included in your Box 1 wages. Nov 12, 2025 · This guide provides answers to common Form W-2 questions and an explanation of each box on a Form W-2. Federal (Box 1) will be reduced by Retirement Plan 401K and all Pre-Tax deductions. Mar 29, 2025 · W-2 form involves understanding each box and its significance. To arrive at your total salary using Box 1, add your federal taxable wages shown in that box to your nontaxable wages plus your pretax deductions that are exempt from federal income tax. Even if you don’t have to file a tax return, you may be eligible for a refund if box 2 shows an amount or if you are eligible for any credit. In this article, we’ll break down the components of the W-2 form, clarify what Box 1 includes, and provide some practical insights into how it impacts your financial Can Box 3 Be Higher Than Box 1 on W-2? Box 3 shows your total wages subject to the Social Security tax. Dec 4, 2023 · Taxes can feel intimidating, so we've compiled easy to understand information on your W2 and other special tax forms. Understand wages, tax withholding, Social Security, Medicare, and state/local taxes to file your return. Understanding Your W-2 Payroll receives many questions about the W-2. Any taxable fringe benefits (such as group term life insurance, personal use of a College vehicle, rent-free housing, etc. 2%). Why? The Aug 26, 2025 · Form W-2 reporting for retirement plan contributions Box 1 (Wages) – Don’t include pre-tax contributions made under a salary reduction agreement. April Reeves, Social Media Editor Apr 11, 2025 · Is my employer shorting my wages (Box 3) on my W-2 form? I've been working at an upscale steakhouse where I make most of my income from tips. Each of these boxes displays a summation of different types of wages paid to the employee or specified deductions/benefits paid during the calendar year listed on the form. The total wages for Box 3 and Box 5 may differ from the amount in Box 1 because not all taxable wages are subject to the same taxes. Nov 20, 2023 · If Box 3 shows an amount over $160,200 , you will need to have your employer correct your W-2. Confused by the W-2 form? Our guide explains this vital tax document, how to read it, and why it's essential for a smooth tax season. Form W-2's are mailed out to your home address if you opted to receive paper copies of your Form W-2. We do this through the IRS Form W-2, Wage and Tax Statement. Find out what they all mean and how they affect your income tax. Find your total earnings before taxes and deductions. 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. The resulting amount should equal Box 3 Social Security Wages and Box 5 Medicare Wages on your W-2, unless your Social Security Wages were capped at the annual limit of $160,200. Apr 10, 2024 · I received a W-2 for my long term disability settlement with an insurance company. Box 1 of the W-2 shows your taxable wages for federal income tax purposes. Therefore, we will guide you through each box of Form W2 and provide the necessary information to be entered. On the employee's Form W-2, show the payment as social security wages (box 3) and Medicare wages and tips (box 5) and the social security and Medicare taxes withheld in boxes 4 and 6. ) are also included in your Box 1 wages. g. Feb 1, 2022 · Ever wondered how to read a W-2? And what should you do with it? Learn the basics in our and ensure your information is correct before filing your taxes. Tips reported to your employer are not included in the Box 3 amount. Box 3 & 5 (Social Security and Medicare wages) - Include all employee pre-tax, after-tax and designated Roth contributions. An employee's elected retirement plan contributions are not subject to federal income taxes. Understanding W-2 Box 3 vs. that are subject to Social Security tax. Feb 17, 2012 · For a form that reports employment income, the W2 sure has a lot of boxes. Box 15: Employer’s State and State Tax ID Mar 27, 2025 · Box 3 – Social Security Wages Box 3 shows the total amount of income that was subject to the employee portion of Social Security tax (6. Employer's contribution should not appear in box 1, 3, nor 5 of the W2. Box 1 Wage Differences Confusion about wage amounts and tax withholding differences on W-2 forms. RECONCILING YOUR FORM W-2 WAGE AND TAX STATEMENT Welcome to the University of Arizona Form W-2 Breakdown Tool This tool presents a full breakdown of the dollar amounts found in Box 1 (Federal), Box 3 (FICA), and Box 5 (Medicare) of an employee’s 2024 Form W-2 to provide a better understanding of those amounts and how they were determined. Employer Information: Name, EIN, Employer Type, and Address The wages in box 5 of Form W-2 must be equal to or greater than the wages in box 3 of Form W-2. May 31, 2019 · The amounts in box 1 and box 3 of your W-2 will be different if you had a pre-tax deduction. Step 2: Determine Any Exclusions The resulting amount should equal Box 3 Social Security Wages and Box 5 Medicare Wages on your W-2. , Form 941, Form 944, Form CT-1 or Schedule H, Form 1040). Box 3: Wages subject to Social Security tax. The premium was paid by the employer. Understanding Your W-2 The following information is intended to answer the most frequently asked questions regarding the content and distribution of your W-2, which is needed to file income tax returns. As VolvoGirl mentioned, there are also times when the amounts can be different and that could be when contributions are made to a 401k, or if the person received taxable tips. If you believe an amount is incorrect, please contact Payroll at 240-777-8840. You can also see that there is a checkmark in Box 13. You cannot tell by looking at the W-2 if the employer removed these items, so Jan 8, 2019 · Entering wage base and tax adjustment Form W-2 boxes and codes Print W-2 and W-3 forms If you need to reach out for more assistance, our phone agents will be able to help you get to a resolution quickly. I dont know if this will affect my ability to File with this W2 or if I have to Request and wait for a Corrected W2 that includes this. Just as an example: if you made tax-deferred retirement contributions to a 401k, that money is exempt from federal income tax but not from Social Security taxes. Your W-2 does not reflect your final pay stub year salary. All employer contributions should be in box 12 of the W-2 with code "W". This often differs from your total gross income for a few reasons. If a Form W-2 can’t be obtained from the employer, select the box to indicate this is a substitute W-2. One of the most common differences between box 1 and boxes 3 and 5 is the amount of employee contributions to deferred compensation plans such as traditional 401 (k) and 457. Tax-deductible retirement account contributions are NOT deductible from your Social Security Wages, and thus ARE subject to SS tax (but are NOT subject to income taxes, which is why they don't appear in Box 1). W-2 FICA Wages On the Form W-2, the Social Security wages in box 3 and the Medicare wages in box 5 are calculated slightly differently from the wages subject to income taxes. Mar 19, 2025 · Learn what each box on your W-2 form means. Aug 28, 2023 · Confused about deductions? Understand state withholding on W-2, how it affects your refund or taxes owed, and what to do if it’s incorrect. Federal Tax Withheld (W-2 Box 2): The total amount of federal income tax withheld from your paycheck. Box 1 reports your total taxable wages for federal income tax purposes. 03 - Calculating Box Totals on Form W-2 Table of Contents Apr 11, 2025 · Why do my W2 boxes 1, 3, and 5 all have vastly differing amounts? Something seems off I think I get the basic idea of why federal taxable wages (box 1) might be lower than the wages used for SS/Medicare calculations. Box 1 shows taxable wages for federal income tax, excluding pre-tax deductions like health insurance. Jan 22, 2024 · Why is W2 box 1 less than box 3? If an employee elected to contribute to a pre-tax retirement plan, their W-2 Box 1 wages are likely lower than their Box 3 wages. On the employee's W2 the adjustment is reflected correctly in box 1 wages but not in box 3 Social Security wages, box 5 Medicare wages and box 16 state wages. Box 3: Social Security wages. Any combination is possible; however, boxes 3 and 5 are most often the same and box 1 can be lower than 3 and 5. The total Social Security tax paid on Box 3 is listed in Box 4. Read now for clear insights! The wages in box 5 of Form W-2 must be equal to or greater than the wages in box 3 of Form W-2. Here's how to get a W-2 form and how to read it. Mar 8, 2025 · W-2 Box 3 is the amount of wages used to calculate Social Security withholding. You weren't paid $69,700 total W-2 Wage and Tax Statement Explained The W-2 form is a United States federal wage and tax statement that an employer must give to each employee and also send to the Social Security Administration (SSA) every year. Box 5: Wages subject to Medicare tax. Nov 12, 2025 · If you have W-2 employees who you paid during 2024, you probably need to complete and file Form W-3, also known as the “Transmittal of Wage and Tax Statements,” with the Social Security Administration (SSA). 2 days ago · Discover the precise reasons Box 1 (federal taxable wages) and Box 3 (Social Security wages) diverge on your W-2 due to deduction rules and wage caps. Descriptions of the information used to populate the Form W-2 are available below. Why aren’t these payments reflected on my Feb 9, 2023 · The amount of information on your Form W-2 can be overwhelming. ) or exempt from withholding Social Security and Medicare taxes. Jan 12, 2024 · An employer will issue a Form W-2 to you if you are an employee. This amount is determined by how you completed Form W-4. Jan 16, 2025 · When preparing your income tax return, IRS Form W-2 is probably one of the most important documents to understand. You might notice that this amount is higher than Box 1. What entries do we need to make so that Consisting of many boxes, numbers and codes, a W-2 form can be confusing to understand. This figure includes your wages, salary, bonuses, and other taxable compensation. Jun 5, 2019 · My Box 1 (total wages) is completely blank. If you earned less than $118,500 in 2015, expect your Box 1 wages to be less than Box 3 and 5 wages, says Wang, since you can shelter more of your earnings from federal taxes than you can Social Security and Medicare Jun 1, 2019 · I just got my W2's and went to enter them in to file but found that box 3 and 5 were Left Blank. Box 4: Social Security tax withheld from your pay. Mar 31, 2025 · One of the taxes you frequently encounter on your W2 form is the FICA tax. Some pre-tax deductions reduce your taxable income (box 1) and your social security income (box 3). 17, 2023 and ended Dec. Here's a look at what you need to know about your Form W-2 for the current tax season. Tax Year This is the calendar year covered by the W-2. So what is Form W-2? It’ Learn the difference between the taxable wages (box 1), social security wages (box 3, and Medicare wages (box 5) included on your W2. Mar 25, 2025 · Alice, upon consulting a CPA, quickly corrected the mistake by issuing W-2c (corrected W-2 forms) for her employees, adding the stipend amounts to Box 1 (and boxes 3,5). ” This figure represents your gross income for the year, including salary, bonuses, tips, and any other taxable income you received from your employer. If you earned a salary and commissions, bonus or other compensation, they are all mixed together as annual income on W-2s. So even though your pre-tax 401k contributions and health insurance premiums In this example, the employee’s Box 1 amount would be $43,000 ($50,000 – $5,000 – $2,000), while their Box 3 and Box 5 amounts would both be $50,000. Feb 20, 2022 · The issue that I'm encountering is that W3 form box 1 is $800 (using the same example as above) which in turn matches with the employee's W2 box 1. That part makes sense. Learn IRS W2 form details and maximize your tax refunds today. 4. Nov 29, 2022 · The value in Box 14 (if any) depends on the type of information reported by your employer. The Form W-2 is made up of a series of boxes. Tip Reporting Box 7: Tips you reported to your employer that are subject to Social Apr 7, 2025 · Discover how to fill out a W-2 with our step-by-step guide for employers. The W-2 Box 3 amount represents taxable wages that are subject to Social Security taxes. Keep in mind that it is optional (but recommended) for household employers to withhold federal income tax from their employee’s pay. Do you have to file? Refer to the Form 1040 instructions to determine if you are required to file a tax return. ETA Apr 8, 2024 · Does all the information on your W-2 look right? If not, is it a matter of tax nuances, or is there something wrong with your form? Box 8. Especially in cases where you are reading your spouse’s W-2, it is imperative that you know what his or her actual gross income is, as this number impacts both child and spousal support. Answer: Box 3 and Box 5 include your tax-deferred retirement contributions, Box 1 does not. If you had too much or too little taken out of your pay, you can submit a new Form W-4. Box c Apr 25, 2025 · To accurately file your taxes, grasping the purpose of each box on the W-2 form is important. Mar 9, 2022 · It seems to me that "Box 3" should be the one considered here, since it reflects the "Total salary" paid to the employee by employer, whereas "Box 1" reflects various other considerations like 401K contribution by the employee etc. Feb 21, 2024 · It is very common for Box 1, 3, and 5 to all have the same amount. In this expanded guide, we’ll delve deeper into the top 10 frequently asked questions about W-2 form boxes, ensuring you navigate this essential document with confidence and clarity. The final Smar The wages in box 5 of Form W-2 must be equal to or greater than the wages in box 3 of Form W-2. This figure is what the SSA considers when calculating whether an individual's earnings exceed the annual limit for those who take benefits before reaching full retirement age (FRA). It is fairly common for Box 1 to report a lower amount than Box 3. Why are your wages in box 1 less than your Social Security wages on box 3? Sep 29, 2025 · Get clear instructions on Form W-2 Box 12 codes. Feb 12, 2016 · Read Next: When Will I Get My W-2? The other mystery on your W-2 is why your Social Security wages differ from your actual pay. While your payroll company should be familiar with the process, here is a quick overview: Box 1 (Wages) – Do not include any pre-tax contributions made under an employee deferral. Box 1 is gross income for federal income tax purposes. Nov 1, 2025 · Don’t forget Form W-3 when you’re sending copies of your employees’ W-2 forms to the Social Security Administration.