On Form W-2, why would line 1, wages, tips, other compensation, be different from line 3, social security wages, and line 5, Medicare wages and tips?
When the amount in box 1 is less than the amount in boxes 3 and 5, you have received some employee compensation that is not subject to federal income tax but is subject to social security and Medicare taxes. Common examples of this are South Carolina Retirement System/Police Officer Retirement System/Optional Retirement contributions and deferred compensation, e.g. contributions to a 401(k), 403(b) or 457 plan. Another example is an employee benefit plan that provides for the contribution of pretax dollars (e.g. cafeteria plan, flexible spending arrangement, dependent care plan, etc.). When the amount in box 1 is more than the amount in boxes 3 and 5, you have received some employee compensation that is not defined as wages for the purpose of social security and Medicare taxes.
Related Questions
- Since Roth contributions are already included as part of wages, tips and other compensation on the Form W-2, must the amount contributed as Roth contributions be identified on the Form W-2 as well?
- On my Form W-2, why would line 1, wages, tips, other compensation, be different from line 3, social security wages, and line 5, medicare wages and tips?
- On Form W-2, why would line 1, wages, tips, other compensation, be different from line 3, social security wages, and line 5, Medicare wages and tips?
