Paste anything from your W-2 — box values, codes, or just the text as-is. Get a plain-English explanation of each item and what it means for your taxes.
Examples:
No W-2 codes or box references found. Try entering box numbers, amounts, or code letters (D, DD, AA, W, etc.).
Box 12 Code Reference
Box 12 contains one or more letter codes (A through HH) with dollar amounts. Here is every code you might see, what it means, and whether it reduces your taxable income.
All W-2 Boxes Explained
Reference for every numbered box on the W-2 form. Use this if you're wondering why two boxes show different amounts.
The Most Common W-2 Confusion
Why is Box 1 lower than Box 3?
Box 1 (federal taxable wages) is reduced by pre-tax 401(k) contributions, pre-tax health insurance premiums (Section 125 cafeteria plan), FSA and HSA contributions, and dependent care benefits.
Box 3 (social security wages) is only reduced by a few items — importantly, traditional 401(k) contributions (Code D) do NOT reduce social security wages. That's why Box 3 ≥ Box 1 in most cases. Your 401(k) saves you federal income tax but not Social Security or Medicare tax.
Code DD is not income. Box 12 Code DD is one of the most alarming-looking numbers on a W-2 — often $10,000 to $25,000 — but it is completely informational. It is NOT included in your taxable wages, you cannot deduct it, and you do not owe taxes on it. The ACA requires employers to report the total cost of health coverage; that's all DD is. You can ignore it when filing.
Traditional 401(k) vs Roth 401(k). Code D (traditional 401(k)) reduces Box 1 — you don't pay income tax on it now, but you will when you withdraw in retirement. Code AA (Roth 401(k)) is already in Box 1 — you paid income tax on it this year, but qualified withdrawals in retirement are tax-free. The same dollar limit applies to the combination of both.
Box 13 "Retirement Plan" checkbox affects IRA deductibility. If this box is checked, you were active in an employer plan. If your income is above certain thresholds, your traditional IRA contribution may not be deductible — even though you can still make the contribution. Roth IRA contributions are unaffected by this checkbox (only income limits apply to Roth).
Frequently Asked Questions
What does Box 12 Code DD mean?
Code DD shows the total cost of your employer-sponsored health coverage — both the employer's share and your payroll-deducted share combined. It is informational only. It is not taxable income, you cannot deduct it, and it has no effect on your tax liability. Ignore it when filing.
What does Box 12 Code D mean?
Code D is your traditional 401(k) elective deferrals — the amount withheld from your paychecks pre-tax and contributed to your 401(k). This amount was already removed from Box 1 (you don't pay income tax on it this year). Do not deduct it again on your return. The 2025 limit is $23,500 ($31,000 with catch-up contributions if age 50+).
Why does the IRS need to know about Code DD if it's not taxable?
The Affordable Care Act (ACA) requires employers to disclose the cost of health coverage. It was designed so that Congress could eventually tax high-cost "Cadillac" plans. That provision was later repealed, but the reporting requirement remains. The disclosure has no current tax effect for most employees.
I have both Code D and Code AA. Is that allowed?
Yes. You can split contributions between a traditional 401(k) (Code D) and a Roth 401(k) (Code AA) in the same year. The combined total of both cannot exceed the annual limit ($23,500 in 2025, or $31,000 with catch-up contributions if you are 50 or older).
What does "Statutory Employee" in Box 13 mean?
If "Statutory Employee" is checked, you are classified as a worker whose income is subject to Social Security and Medicare taxes but not federal income tax withholding. Common categories include certain delivery drivers and commissioned insurance salespeople. You report this income on Schedule C (not as regular wages on Form 1040 line 1a) and can deduct business expenses against it.
What is Box 14 for?
Box 14 is a catch-all for information your employer wants to report that doesn't fit elsewhere. Common items: state disability insurance premiums (SDI, SUI, FLI, TDI), union dues, educational assistance, vehicle fringe benefit value, or domestic partner coverage taxable value. Whether Box 14 amounts affect your taxes depends on what they represent — state disability premiums, for example, may be deductible as a state tax on Schedule A if you itemize.
What if I have more than one W-2?
You report each W-2 separately on your tax return. If you had multiple employers and your combined Social Security tax withheld (Box 4) across all W-2s exceeds the annual cap ($10,918.20 for 2025, which is 6.2% of the $176,100 wage base), you may be entitled to a refund of the excess as a tax credit — even though each employer was correctly withholding. Your tax software handles this automatically if you enter all W-2s.