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Human
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Information Center »
How To Read Your 2007 Form W-2
Overview
Employers
are required to report, on Form W-2 by January 31st each year,
taxable wages and related compensation, income taxes, and
certain payroll deductions to both the Internal
Revenue Service (IRS) and the State of Minnesota . The
wages are always reported for the year they are paid.
Following
are step-by-step instructions on how to interpret the amounts
shown in the boxes on your Form W-2, when comparing it to
your pay statement.
Boxes
1 & 2
Box
1 on your Form W-2 indicates your federal taxable wages
and other compensation. Your federal taxable wages are determined
by the following calculation:
- You
must first add together your year-to-date (YTD) earnings,
including taxable benefit earnings. This is found in
the "Hours and Earnings" section of your pay stub. Note:
The total YTD earnings line in that section of your paycheck/deposit
slip does NOT include any taxable benefits listed in
the earnings section. They must be added to your total
YTD gross pay
- To
that total, add any YTD taxable "Employer Paid Benefits" indicated
by an asterisk (*) in that section of your paycheck/deposit
slip
- Lastly,
subtract all YTD "Before-Tax Deductions". The amount remaining
is equal to your Federal Taxable Gross reported in Box
1 on your Form W-2.
Box
2 equals the year-to-date Fed Withholding as shown in
the "Taxes" section of your paycheck/deposit slip
Box
3 & 4
Box 3 indicates your Social Security wages.
The Social Security wage limit for 2007 maximum is $97,500.
To determine your Social Security wages, you must add
your YTD gross earnings (including any taxable benefits
listed in YTD earnings), and your YTD taxable Employer
Paid Benefits indicated by an asterisk (*).
- From that total,
subtract the following applicable "Before Tax Deductions".
The remaining amount is the taxable Social Security wages
reported in Box 3 .
- Medical
- Dental
- Health Care
Reimbursement Account
- Dependent Care
Reimbursement
Box 4 equals
the year-to-date Fed Social Security Taxes that have been
withheld.
Box
5 & 6
Box 5 indicates
your Medicare wages. The calculation to determine your Medicare
wages is the same as your Social Security wages except there
is no limit on Medicare wages.
- To determine your
Medicare wages, you must add your YTD gross earnings (including
any taxable benefits listed in YTD earnings), and your YTD
taxable Employer Paid Benefits.
- From that total,
subtract the following applicable "Before Tax Deductions".
The remaining amount is the taxable Medicare wages reported
in Box 5 .
- Medical
- Dental
- Health Care
Reimbursement Account
- Dependent Care
Reimbursement
Box 6 equals
your year-to-date Fed MED/EE taxes as shown in the "Taxes" section
of your pay statement.
Box
7
Box
7 equals your year-to-date Social Security that has been
withheld from tips.
Box
8
Box
8 equals your year-to-date earnings from tips.
Box
10
This amount
in box 10 equals the total "before-tax" dependent
care benefits paid. Any amount in excess of $5,000 is also
included in boxes 1 , 3, 5 and 16.
Box
12
The following list
explains the codes shown in box 12. You may need this
information to complete your tax return. Other before-tax
deductions, including MSRS, Faculty Retirement Plan, and Medical,
are not reported in box 12 .
Only those listed below
are reported on the W-2.
- Code C - Cost
of group term life insurance over $50,000, included in
boxes 1 , 3, 5 and 16. This amount is indicated by an
asterisk (*) in the ''Employer Paid Benefits" section
of your pay statement.
- Code E - Elective
deferrals into section 403(b) salary reduction agreement.
This is the total paid to the Optional Retirement Plan.
- Code G - Elective
deferrals into the 459(b) plan.
Box
13
Box 13 is
the Retirement Plan indicator. The "Retirement Plan" box
is checked because NWHSU has an active 403(b) plan. If
you are contributing to this fund, there are special limits
that may apply to the amount of traditional IRA contributions
you may deduct.
Box
15 , 16, & 17
Box 15 indicates
the State for which your wages and taxes in boxes 16 and 17
are being reported. Northwestern Health Sciences University
withholds income taxes for the state of Minnesota .
Box 16 indicates
the Minnesota taxable wages and other compensation.
Box 17 equals
the year-to-date State Withholding.
If you have any questions regarding your W2, please
contact Kari
Hellie in Human Resources, Ext. 173
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