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2016 W-2 Explanation

The following represents explanations of key amounts presented on the 2016 Form W-2:

Computation of Box 1 (Wages, tips, other comp):
Total Gross Wages Paid per Employee
Add:  Cost of long-term group insurance coverage in excess of $50,000. (Box 12, Code C)
Less:  Dependent Care Contributions (Box 10)
Less:  Annuity Contributions (Box 12, Code E and G)
Less:  Medical and Dental Insurance Deductions (Pre-Tax)
Less:  Flexible Medical Spending Account Amounts
Less:  VRS Buybacks (Pre-Tax)
Less:  VRS Contributions (Pre-Tax)
Equals Total Wages, Tips and Other Compensation in Box 1
Computation of Box 3 (Social Security Wages)
Total Gross Wages Paid per Employee
Add:  Cost of long-term group insurance coverage in excess of $50,000. (Box 12, Code C)
Less:  Dependent Care Contributions (Box 10)
Less:  Medical and Dental Insurance Deductions (Pre-Tax)
Less:  Flexible Medical Spending Account Amounts
Equals Total Social Security Wages

*** The maximum taxable earnings amount for Social Security is $118,500. The Social Security tax rate for wages paid in 2016 is 6.2 percent. For example, an individual with wages equal to or more than $118,500 would contribute $7,347.00 to Social Security in 2016.
Computation of Box 5 (Medicare Wages)
Total Gross Wages Paid per Employee
Add: Cost of long-term group insurance coverage in excess of $50,000. (Box 12, Code C)
Less: Dependent Care Contributions (Box 10)
Less: Medical and Dental Insurance Deductions (Pre-Tax)
Less: Flexible Medical Spending Account Amounts
Equals Total Medicare Wages

*** The Medicare tax rate for wages paid in 2016 is 1.45 percent.
Other Applicable Explanations
Box 10:  Dependent Care Benefits. Amounts included in this box are an employee’s dependent care deductions for the year.
Box 12a, 12b, 12c and 12d:  The following codes are applicable to Chesapeake Public Schools:
Code C:  Cost of long-term group insurance coverage in excess of $50,000.
Code E:  Amount of elective deferrals to a section 403(b) salary reduction agreement (Tax-Sheltered Annuity deductions)
Code G:  Amount of elective deferrals to a section 457(b) deferred compensation plan (Tax-Sheltered Annuity deductions)
Code J:  Third Party Sick Pay
Code DD: Cost of Health Insurance provided through Chesapeake Public Schools. The amount reported with code DD is not taxable.
Box 14:  Not Used
Box 16:  State wages, tips, etc. Calculation is the same as in Box 1 above.
Box 17:  State income tax withheld. Includes state tax withholdings for the year.