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Why are Boxes 10, 12, and 14 from my W-2 affecting other parts of my tax return? I thought these items aren’t taxable!

To help answer this question, let’s break this down by the boxes shown on your W-2.

Box 10: Dependent Care Benefits

This box is the total dependent care benefits that your employer paid to you or incurred on your behalf. If the value is over $5,000 (or $2,500 if married filing separately), it will also be included in Box 1. The amount will be treated as income and you will be taxed if Form 2441 (Child and Dependent Care Expenses) isn’t properly filled out.

For more information about this process, check out Publication 503 to determine who qualifies as a dependent and what expenses are eligible. You can also try out the Interactive Tax Assistant to see if you can claim someone as your dependent.

Box 12: Letter Codes

Pay attention to the values and codes on Box 12, because this is one of the most common errors on a W-2 affecting sections such as healthcare and retirement plans. When accidentally selecting the wrong code on your tax return, you may be taxed on an item that shouldn’t normally be taxed.

Here’s are some common codes you may find on your W-2, box 12:

AA: Designated Roth contributions under a section 401(k) plan

BB: Designated Roth contributions under a section 403(b) plan
C: Taxable cost of group-term life insurance over $50,000
DD: Cost of employer-sponsored health coverage
D: Elective deferrals under a section 401(k) cash or deferred arrangement plan (including a SIMPLE 401(k) arrangement)
EE: Designated Roth contributions under a governmental section 457(b) plan
E: Elective deferrals under a section 403(b) salary reduction agreement
F: Elective deferrals under a section 408(k)(6) salary reduction SEP
G: Elective deferrals and employer contributions (including nonelective deferrals) to a section 457(b) deferred compensation plan
H: Elective deferrals to a section 501(c)(18)(D) tax-exempt organization plan
J: Nontaxable sick pay
R: Employer contributions to an Archer MSA
S: Employee salary reduction contributions under a section 408(p) SIMPLE plan
T: Adoption benefits
W: Employer contributions to an employee’s health savings account (HSA)
Y: Deferrals under a section 409A nonqualified deferred compensation plan

For a full list of codes along with its definitions, see the instructions that came with your W-2 form or go to page 29 of the W-2 and W-3 Instructions

Box 14: Other

This box is for remaining information provided by employers that doesn’t fall under any other category. Some items you may see here are state disability insurance taxes withheld, union dues, health insurance premiums deducted, etc.

Depending on the item, it may also be reported on another part of your tax return. For example, health insurance premiums listed on box 14 of your W-2 will flow to Schedule A line 5, (medical expenses) . If Box 14 doesn’t have a value on your W-2, leave this section blank instead of entering 0.

Still have questions? Contact member support

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