(Tax Year 2024 – Filed in 2025)
Overview
Form W-2 is issued by employers to report annual wages and the amount of taxes withheld from an employee’s paycheck. It’s a key document used to file your federal and state income tax returns. For income earned in 2024, W-2s must be provided to employees by January 31, 2025, as required under Internal Revenue Code § 6051.
Every box on your W-2 serves a specific purpose. Misreading even one field can result in incorrect tax filings or missed deductions. This guide explains what each box means so you can file your taxes accurately.
Employee and Employer Information
- Box a – Your Social Security Number
- Box b – Employer Identification Number (EIN)
- Box c – Employer’s name and address
- Box d – Control number (used internally by employer or payroll provider)
- Box e – Your full name
- Box f – Your address
Wage and Tax Details
These are the most important boxes for federal income tax purposes:
- Box 1 – Wages, tips, and other compensation
This is your total taxable income reported on your Form 1040, Line 1. - Box 2 – Federal income tax withheld
The total amount your employer withheld for federal taxes. - Box 3 – Social Security wages
May differ from Box 1 if you contributed to pre-tax benefits. - Box 4 – Social Security tax withheld
Typically 6.2% of Box 3 (up to the annual wage limit). - Box 5 – Medicare wages
No cap—this may include pre-tax deductions not excluded from Medicare tax. - Box 6 – Medicare tax withheld
Typically 1.45% of Box 5 (plus additional 0.9% if wages exceed thresholds). - Box 7 – Social Security tips
Tips you reported to your employer. - Box 8 – Allocated tips
Tips assigned by your employer if you’re in the service industry. - Box 9 – Not used (left blank).
- Box 10 – Dependent care benefits
Employer-provided benefits under a dependent care assistance program. - Box 11 – Nonqualified deferred compensation
Income that was earned in a prior year but paid this year.
Box 12 – Additional Codes
This box reports various types of compensation or benefits. Some common codes include:
- Code D – Elective deferrals to a 401(k) plan
- Code E – 403(b) retirement contributions
- Code DD – Cost of employer-sponsored health coverage (for info only)
- Code W – Employer contributions to a Health Savings Account (HSA)
Refer to the IRS W-2 instructions for the full list of codes.
Box 13 – Special Indicators
This box contains checkboxes for:
- Statutory employee – Income is subject to Social Security/Medicare, but not income tax withholding
- Retirement plan – Indicates you participated in an employer-sponsored plan
- Third-party sick pay – If applicable
Box 14 – Other Information
This is used for items not reported elsewhere, such as:
- State disability insurance (SDI)
- Uniform allowances
- Union dues
- Educational assistance
Employers may use this box differently, depending on the state and company policy.
State and Local Information (Boxes 15–20)
These boxes report state and local income details:
- Box 15 – State and employer’s state ID number
- Box 16 – State wages
- Box 17 – State income tax withheld
- Box 18 – Local wages
- Box 19 – Local income tax withheld
- Box 20 – Name of locality (e.g., city or school district)
Example Scenario
Priya works full-time and earned $75,000 in 2024. Her W-2 includes:
- Box 1 – $75,000 (taxable wages)
- Box 2 – $8,100 (federal income tax withheld)
- Box 3 – $75,000 (Social Security wages)
- Box 4 – $4,650 (Social Security tax withheld)
- Box 5 – $75,000 (Medicare wages)
- Box 6 – $1,087.50 (Medicare tax withheld)
- Box 12, Code D – $5,000 (401(k) contribution)
This information is used to complete Priya’s Form 1040, calculate credits, and determine if she owes additional tax or is due a refund.
What to Do Before Filing
- Review all entries for accuracy
- Check your name, SSN, and address
- Confirm wage and withholding amounts
- Report discrepancies to your employer immediately
- Request a corrected Form W-2c if necessary
Conclusion
Every box on your W-2 form connects directly to a part of your federal or state tax return. Understanding how to read your W-2 ensures you file correctly, avoid errors, and claim any eligible deductions or credits. Review your form thoroughly before submitting your tax return.
Call to Action
Have questions about your W-2 or unsure if the information is correct? Book a consultation with Anshul Goyal, CPA EA FCA. Anshul will review your form in detail and help you file a compliant and accurate tax return for 2024.
Top 5 FAQs: Reading Your W-2
What is the most important box on my W-2?
Box 1, which shows your total taxable wages for federal income tax.
Why is Box 1 different from Box 3?
Box 3 includes Social Security wages, which may exclude pre-tax deductions that reduce Box 1.
What are the codes in Box 12?
They represent specific benefits or contributions like 401(k), HSA, or health insurance premiums.
Can I file my return if my W-2 has errors?
No. Request a corrected form (W-2c) before filing to avoid problems.
Do I need to include all boxes when filing my taxes?
You must include all relevant income and tax withholding amounts. Not every box applies to every employee.
About Our CPA
Anshul Goyal, CPA EA FCA is a U.S.-licensed Certified Public Accountant and an IRS-authorized Enrolled Agent. With experience in W-2 analysis, individual tax return filing, and IRS representation, Anshul helps both U.S. taxpayers and Indian residents in the U.S. stay fully compliant.
Schedule a meeting with Anshul here:
https://calendly.com/anshulcpa/
Disclaimer
This blog is for informational purposes only and should not be considered tax or legal advice. Please consult a licensed tax professional for guidance specific to your situation.