Question

Please answer questions 6, 7, and B together as they relate to the attached W-2 Form and to each other 123-45-6189OWS No 140000 500 , 770 security tax wihhekd 3, 110 I-aa 33445 name, address, and DP code secury wages The Mom and Pop Shop 457 Cherry Tree Lane Mathis, TN 32906 Medioare 5 o, oo0 725 tips Veifcalion cods AIBa D I.600 1DDI 5,000 at rame and nti Last name Martin C. creswell 413 Rectangle Way Anywhere, TN a290o 7 State income ta .535 18 Eaie TN 12345 48,60 750 VS 48,500 Martin is a single filer who received $55,000 from The Mom and Pop Shop in 2018. He paid $5,000 for health insurance coverage through his employer, The Mom and Pop Shop, and his employer paid $5,000 as well (totaling to $10,000 worth of coverage). Martin also made 401(k) elective deferrals throughout 2018. How is this information reflected in Martin's W-2 Form? 6. What do each of the codes in box 12 (D and DD) indicate? List 5 other codes you would potentially see in box 12 (including their meanings). 7. 8. How does box 12a, in this case, relate to boxes 1 and 31?

Answer 1

6 )The chart on the Form W-2 Reporting of Employer-Sponsored Health Coverage lists many types of health care coverage and various other situations, and explains whether reporting is required, prohibited, or optional in order to improve the information reporting process.

The amount reported should include both the amounts paid by the employer and the amount paid by the employee. In the case of a health FSA, the amount reported should not include the amount of any salary reduction contributions.The cost of these health care benefits will be reported in box 12 of the Form W-2, with Code DD to identify the amount.

Elective deferrals made by Martin to a section 401(k) is reflected in Box 12 —W-2 Form Code D.

7) Box 12 amounts with the code D represents Contributions to the 401(k) plan and Code DD represents the total cost of what the employee and the employer paid for the employer-sponsored health coverage plan.

Following codes in Box 12 may be potentially seen in future:

• A: Uncollected social security or RRTA tax on tips reported to your employer
• B: Uncollected Medicare tax on tips reported to your employer (but not Additional Medicare Tax)
• C: Taxable cost of group-term life insurance over $50,000
• J: Non-taxable sick pay
• L: Substantiated employee business expense reimbursements

8)Box 12 A represents : Uncollected social security or RRTA tax on tips reported to the employer and in this case box1 tips is 48500 and box 3 social security wages is 50,000