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W-2 Wage and Tax Statement Explained
The W-2 form is a United States federal wage and tax statement that an employer must give to each employee and also send to the Social Security Administration (SSA) every year. Your W-2 Wage and Tax Statement itemizes your total annual wages and the amount of taxes withheld from your paycheck.
Tax Year
This is the calendar year covered by the W-2.
Copies
You receive three copies of your W-2:
- Copy 2 - attach it to your state and city or other local tax return
- Copy B - attach it to your federal tax return
- Copy C - keep it for your records
The City sends wage and tax information to the Social Security Administration and the New York State Department of Taxation and Finance.
Box a: Employee's social security number
This is your taxpayer identification.
The IRS uses your social security number (SSN) to verify the data it receives from the City against the amounts shown on your tax returns.
The Social Security Administration uses your SSN to record your earnings for future social security and Medicare benefits.
If your SSN is incorrect, present your social security card to your Personnel Office immediately. The Personnel Office will forward a copy of your social security card to OPA along with a W-2 Duplicate Request Form or a W-2 Correction Request Form. OPA will verify your information with the Social Security Administration and then issue a corrected W-2.
Box b: Employer identification number (EIN)
This is the Employer Identification Number assigned by the IRS to The City of New York, Department of Education, City University of New York, New York City Housing Authority, or New York City Municipal Water Finance Authority.
Box c: Employer's name, address, and ZIP code
This is your employer's information for tax reporting purposes.
Box d: Control number
This box is blank.
Boxes e, f: Employee's first name and initial, Last name, Suff., Employee’s address and ZIP code
This box shows your name and address which is currently in the City's Payroll Management System.
If your name changes, your earnings cannot be posted by SSA until your social security records are updated. You can report a name change to SSA by calling 1-800-772-1213.
If your name is incorrect, you should notify your agency. A corrected W-2 will be issued.
If your address is incorrect, you can still use the W-2. You should change your home address in NYCAPS Employee Self-Service (ESS) or report address changes to your agency.
Box 1: Wages, tips, other compensation
These are your taxable wages during the year. You need it for filing federal and New York State tax returns.
The taxable wages consist of the gross wages and other compensation paid to you during the year, including the following taxable fringe benefits:
- Union-sponsored Legal Service Fringe Benefit
- Motor Vehicle Fringe Benefit
- Parking Fringe Benefit
- Health Buy-Out Waiver Payment
- Commuter Benefits Administrative Fringe Fee
- Domestic Partner Health Insurance Premiums
- Health and Fitness Reimbursement
- Wellness Benefits
Your taxable wages are reduced by contributions to deferred compensation and/or tax deferred annuity accounts, pension plan, Commuter Benefits, health insurance, and other programs that are not subject to federal taxes. These amounts are shown in Boxes 12 and 14.
The above listed taxable fringe benefits are shown in Box 14.
Box 2: Federal income tax withheld
This is the total federal income tax withheld from your pay during the year.
Box 3: Social security wages
These are the total wages paid that are subject to social security.
The total in Box 3 should not be more than the maximum social security wage base for that tax year.
Social security wages are reduced for health insurance premiums, Commuter Benefits, and some flexible spending program contributions.
Social security wages are not affected by deferred compensation or pension contributions.
Box 4: Social security tax withheld
This is the total social security tax withheld from your pay during the year.
Most employees pay 6.2% of covered wages, up to the maximum social security wage base which is adjusted each year. If more than 6.2% of that amount was withheld, OPA will issue you a refund in February. If you do not receive a refund that is owed to you, contact your agency's Payroll Office.
Box 5: Medicare wages and tips
The wages subject to Medicare tax are the same as those subject to social security tax in Box 3, except there is no wage base limit for Medicare tax.
Medicare wages are reduced for health insurance premiums, Commuter Benefits, DeCAP, and HCFSA contributions.
Medicare wages are not affected by deferred compensation or pension contributions.
Box 6: Medicare tax withheld
This is the total Medicare tax withheld from your pay during the year.
Most employees pay 1.45% of covered wages for Medicare tax. There is no maximum Medicare wage base for the Medicare portion of FICA. FICA is comprised of Medicare and social security.
Box 10: Dependent care benefits
These are the contributions to Dependent Care Assistance Program (DeCAP) made through payroll deductions.
Contributions to DeCAP are not subject to federal, social security, and Medicare taxes. The amounts in Box 1 for taxable wages and Boxes 3 and 5 for social security and Medicare wages are reduced by the amount of the contribution.
DeCAP contributions are subject to New York State and City taxes and must be added back to Box 1 when filing New York State and City tax returns. Amounts for DeCAP are also shown in Box 14.
Box 11: Nonqualified plans
Box 11 does not apply to NYC W-2s and will be blank.
Box 12:
Tax deferred annuities (TDA)
If you participate in a TDA plan, your contributions are shown in Box 12 with the following codes:
- Code AA = Contributions to Roth 401(k) Plan
- Code BB = Contributions to Roth 403(b) Plan
- Code D = Contributions to 401(k) Plan
- Code E = Contributions to 403(b) Plan
- Code G = Contributions to 457 Plan
- Code EE = Contributions to Roth 457 Plan
Most TDA contributions are not subject to income taxes. Your taxable wages (Box 1) and your state and City wages (Boxes 16 and 18) are reduced because of your TDA contributions. You file your federal, state, and city tax returns on the lower reported wage amount.
TDA contributions are subject to FICA taxes. Your wages for social security and Medicare taxes (Boxes 3 and 5) may be greater than the wages recorded for income tax purposes (Boxes 1, 16, and 18).
Cost of employer-sponsored health coverage.
This is the combined cost (employer’s and employee/retiree’s) of employer-sponsored group health plans.
As part of the Patient Protection and Affordable Care Act of 2010, employers are required to report this cost to each employee. The amount is shown in Box 12 with the code DD. It is for informational purposes only and is not taxable.
Box 13: Retirement plan
Indicates employee’s eligibility for pension plan membership. The IRS defines an employee as belonging to a pension plan if that employee is eligible to join a pension plan regardless of whether the plan is joined.
The Retirement Plan checkbox in Box 13 will be checked, except for the following:
- Retirees receiving W-2s only for legal service fringe
- Hearing Officers (PVB) with wages only from the Department of Finance
- Retirees who retired prior to that calendar year and are drawing a City pension and receiving wages from City employment
- Terminated employees who have no wage record for that calendar year but received other types of pay requiring a W-2.
Box 14: Other
IRC414H for Pension Contributions
These are the payroll deductions covered under the Internal Revenue Code Section 414 for pension contributions.
If you are a pension member, your taxable wages in Box 1 are reduced by the amount of your pension contributions. Your contributions shown in Box 14 are not subject to federal income tax, but are subject to FICA (social security and Medicare), state, and local taxes.
To obtain your taxable wages for New York State and City, add the amount in Box 14 to that in Box 1. Only standard pension deductions and certain "buy back" deductions are included in the IRC414H amount. Pension loan repayment deductions are not included.
IRC125 for Pre-Tax Benefit Programs
These are the payroll deductions covered under the Internal Revenue Code Section 125 for flexible spending account programs.
These include:
- Health insurance premiums
- Dependent Care Assistance Program (DeCAP)
- Health Care Flexible Spending Account (HCFSA)
If you added a domestic partner to your health insurance, a portion of the amount paid by the City is taxable and is included in Box 14.
The amount in the IRC125 box is treated on a pre-tax basis for federal income purposes. It reduces your taxable wages (Box 1) and social security and Medicare wages (Boxes 3 and 5). The reduction in year-to-date earnings shows in your W-2, not in your pay statement.
This amount is subject to state and City taxes and must be added back to the taxable wages in Box 1 when you file your taxes. The amount for DeCAP is shown in Box 14 and Box 10.
IRC132 for Commuter Benefits
These are the payroll deductions covered under the Internal Revenue Code Section 132 for Commuter Benefits.
This amount reflects your pre-tax Commuter Benefits contributions. Your taxable wages (Box 1), social security and Medicare wages (Boxes 3 and 5), and your state and City wages (Boxes 16 and 18) are reduced by your Commuter Benefits deductions during the year.
IMP for Domestic Partner Benefit
The W-2 form includes the taxable value of your domestic partner's health plan coverage provided by the City and/or union welfare fund.
IMP - Imputed Income, which is the taxable value of the employer contribution for health benefits provided to a retiree's domestic partner. This amount is included in Box 1 and must be reported for federal, state and local taxes. This amount is shown in Box 14 labeled as "IMP". The City paid your social security (Box 4) and Medicare (Box 6) taxes. Therefore, your taxable wage amounts (Boxes 1, 3 and 5) have been increased accordingly.
HWB for Health Care Worker Bonus
The W-2 form includes a one-time, non-pensionable payment for health care worker bonus received by eligible City employees. The payment is not subject to New York State, City, or Yonkers withholding taxes.
Box 15: State
New York.
Note for Washington DC residents:
The Washington DC (District of Columbia) regulations require all employers to report wages that were earned by the employee who both worked and lived in Washington DC, in Box 16. For these employees the state is WASH DC.
Box 16: State wages, tips, etc.
This box contains the wages reported in Box 1. The following is not subject to state tax:
- Tax Deferred Annuity and Deferred Compensation Plan (Box 12)
- IRC132 for Commuter Benefits (Box 14)
- Domestic Partner Benefit (IMP) (Box 14)
The following are subject to state tax and included in Box 16:
- Union-sponsored Legal Service Fringe Benefit
- Motor Vehicle Fringe Benefit
- Parking Fringe Benefit
- Health Buyout Waiver Payment
- Domestic Partner Health Insurance Premiums
- Health and Fitness Reimbursement
- Wellness Benefits
The following are subject to state tax and must be added to state wages on your individual tax return:
- Pension Deductions (Box 14)
- Health Insurance Premiums (Box 14)
- Dependent Care Assistance Program (DeCAP) Deductions (Boxes 14 and 10)
- Health Care Flexible Spending Account (HCFSA) Deductions (Box 14)
Box 17: State income tax
This is the total state income tax withheld from your pay during the year.
Box 18: Local wages, tips, etc.
These are the wages reported in Box 1.
Box 19A: Local income tax
This is the New York City tax withheld from your pay during the year.
Box 19B: Local income tax
This is the Yonkers tax withheld from your pay during the year (for Yonkers residents only).
Box 20A: Locality name
New York City.
Box 20B: Locality name
Yonkers (for Yonkers residents only).