Instructions For Forms W-2 And W-3 - Wage And Tax Statement And Transmittal Of Wage And Tax Statements - 2016 Page 17
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32For more information on Additional Medicare Tax, go to
substantial risk of forfeiture are taxable even if not
IRS.gov and enter “Additional Medicare Tax” in the search
distributed. Report these amounts in boxes 3 (up to the
box.
social security wage base) and 5. Do not report in box 11
deferrals included in boxes 3 and/or 5 and deferrals for
Box 7—Social security tips. Show the tips that the
current year services (such as those with no risk of
employee reported to you even if you did not have enough
forfeiture).
employee funds to collect the social security tax for the
tips. The total of boxes 3 and 7 should not be more than
If you made distributions and also are reporting
$118,500 (the maximum social security wage base for
any deferrals in boxes 3 and/or 5, do not
!
2016). Report all tips in box 1 along with wages and other
complete box 11. See Pub. 957, Reporting Back
CAUTION
compensation. Include any tips reported in box 7 in box 5
Pay and Special Wage Payments to the Social Security
also.
Administration, and Form SSA-131, Employer Report of
Special Wage Payments, for instructions on reporting
Box 8—Allocated tips (not applicable to Forms
these and other kinds of compensation earned in prior
W-2AS, W-2CM, W-2GU, or W-2VI). If you operate a
years. However, do not file Form SSA-131 if this
large food or beverage establishment, show the tips
situation applies and the employee was not 61 years
allocated to the employee. See the Instructions for Form
old or more during the tax year for which you are
8027, Employer's Annual Information Return of Tip
filing Form W-2.
Income and Allocated Tips. Do not include this amount in
boxes 1, 3, 5, or 7.
Unlike qualified plans, NQDC plans do not meet the
qualification requirements for tax-favored status for this
Box 9. Do not enter an amount in box 9.
purpose. NQDC plans include those arrangements
Box 10—Dependent care benefits (not applicable to
traditionally viewed as deferring the receipt of current
Forms W-2AS, W-2CM, W-2GU, or W-2VI). Show the
compensation. Accordingly, welfare benefit plans, stock
total dependent care benefits under a dependent care
option plans, and plans providing dismissal pay,
assistance program (section 129) paid or incurred by you
termination pay, or early retirement pay are not generally
for your employee. Include the fair market value (FMV) of
NQDC plans.
care in a daycare facility provided or sponsored by you for
Report distributions from NQDC or section 457 plans to
your employee and amounts paid or incurred for
beneficiaries of deceased employees on Form
dependent care assistance in a section 125 (cafeteria)
1099-MISC, not on Form W-2.
plan. Report all amounts paid or incurred (regardless of
Military employers must report military retirement
any employee forfeitures), including those in excess of the
payments on Form 1099-R.
$5,000 exclusion. This may include (a) the FMV of
benefits provided in kind by the employer, (b) an amount
Do not report special wage payments, such as
paid directly to a daycare facility by the employer or
accumulated sick pay or vacation pay, in box 11.
TIP
reimbursed to the employee to subsidize the benefit, or (c)
For more information on reporting special wage
benefits from the pre-tax contributions made by the
payments, see Pub. 957.
employee under a section 125 dependent care flexible
spending account. Include any amounts over $5,000 in
Box 12—Codes. Complete and code this box for all
boxes 1, 3, and 5. For more information, see Pub. 15-B.
items described below. Note that the codes do not relate
to where they should be entered in boxes 12a through 12d
An employer that amends its cafeteria plan to
on Form W-2. For example, if you are only required to
provide a grace period for dependent care
TIP
report code D in box 12, you can enter code D and the
assistance may continue to rely on Notice 89-111
amount in box 12a of Form W-2. Report in box 12 any
by reporting in box 10 the salary reduction amount elected
items that are listed as codes A through EE. Do not report
by the employee for the year for dependent care
in box 12 section 414(h)(2) contributions (relating to
assistance (plus any employer matching contributions
certain state or local government plans). Instead, use
attributable to dependent care). Also see Notice 2005-42,
box 14 for these items and any other information that you
2005-23 I.R.B. 1204, available at
wish to give to your employee. For example, union dues
2005-23_IRB/ar11.html.
and uniform payments may be reported in box 14.
Box 11—Nonqualified plans. The purpose of box 11 is
On Copy A (Form W-2), do not enter more
for the SSA to determine if any part of the amount
than four items in box 12. If more than four
TIP
reported in box 1 or boxes 3 and/or 5 was earned in a
items need to be reported in box 12, use a
prior year. The SSA uses this information to verify that
separate Form W-2 to report the additional items (but
they have properly applied the social security earnings
enter no more than four items on each Copy A (Form
test and paid the correct amount of benefits.
W-2)). On all other copies of Form W-2 (Copies B, C,
Report distributions to an employee from a nonqualified
etc.), you may enter more than four items in box 12 when
plan or nongovernmental section 457(b) plan in box 11.
using an approved substitute Form W-2. See Multiple
Also report these distributions in box 1. Make only one
forms.
entry in this box. Distributions from governmental section
Use the IRS code designated below for the item you
457(b) plans must be reported on Form 1099-R, not in
are entering, followed by the dollar amount for that item.
box 1 of Form W-2.
Even if only one item is entered, you must use the IRS
Under nonqualified plans or nongovernmental 457(b)
code designated for that item. Enter the code using a
plans, deferred amounts that are no longer subject to a
-17-
General Instructions for Forms W-2 and W-3 (2016)
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