Wondering whether your spouse has disclosed all the compensation he or she is receiving? Employees are often compensated in ways that are not reflected in the deposit to the family bank account. It is important to ask for both pay stubs and past W-2s when investigating hidden assets. Employers will report assets such as contributions to valuable retirement plans and various types of executive compensation in Box 12 of the W-2. Here is a list of the codes and what they mean:
A — Uncollected Social Security or RRTA tax on tips
B — Uncollected Medicare tax on tips
C — Taxable costs of group-term life insurance over $50,000
D — Elective deferral under a 401(k) cash or arrangement plan. This includes a SIMPLE 401(k) arrangement.
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 non-elective 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
K — 20% excise tax on excess golden parachute payments
L — Substantiated employee business expense reimbursements (nontaxable
)M — Uncollected Social Security or RRTA tax on taxable cost of group-term life insurance over $50,000 (former employees only)
N — Uncollected Medicare tax on taxable cost of group-term life insurance over $50,000 (former employees only)
P — Excludable moving expense reimbursements paid directly to a member of the U.S. Armed Forces
Q — Nontaxable combat pay
R — Employer contributions to your Archer medical savings account (MSA)
S — Employee salary reduction contributions under a Section 408(p) SIMPLE
T — Employer provided Adoption benefits (not included in Box 1)
V — Income from exercise of nonstatutory stock options
W — Employer contributions (including amounts the employee elected to contribute using a Section 125 cafeteria plan) to your health savings account (HSA)
Y — Deferrals under a Section 409A nonqualified deferred compensation plan
Z — Income under a nonqualified deferred compensation plan that fails to satisfy Section 409A. This amount is also included in Box 1 of Form W-2 and is subject to an additional 20% tax plus interest.
AA — Designated Roth contribution under a 401(k) plan
BB — Designated Roth contributions under a 403(b) plan
CC — For employer use only
DD —Cost of employer-sponsored health coverage
EE — Designated Roth contributions under a governmental 457(b) plan
FF — Permitted benefits under a qualified small employer health insurance reimbursement arrangement
GG — Income from qualified equity grants under Section 83(i)
HH — Aggregate deferrals under Section 83(i) elections as of the close of the calendar year
If you find any of these codes in Box 12, the information you need to seek and how to divide these benefits can get pretty complicated. Hiring a CDFA to help figure this out can ensure your bases are covered.