How to Read Your W-2 Form in 2026: Every Box Explained

Your W-2 (Wage and Tax Statement) is the most important tax document you receive each year. Every number on it flows directly into your tax return — and understanding each box prevents errors and confusion.

Employers must mail W-2s by January 31 of the following year. Here’s what every section means.

The Basic Layout

A W-2 has boxes labeled with letters (a, b, c, etc.) for employer/employee information and numbered boxes (1 through 20) for dollar amounts. Let’s go through the important ones.

Boxes a–f: Identification Information

Box	What It Shows
a	Your Social Security Number
b	Employer Identification Number (EIN)
c	Employer’s name, address, zip
d	Control number (internal employer use)
e/f	Your name and address

Verify Box a carefully — your SSN must match IRS records exactly. A mismatch can delay your refund.

Box 1: Federal Wages, Tips, and Other Compensation

This is the number you enter on Form 1040 as wages.

Box 1 is your federal taxable wages — gross pay minus pre-tax deductions:

• Traditional 401(k) contributions (reduce Box 1)
• HSA contributions via payroll (reduce Box 1)
• Health/dental/vision insurance premiums paid pre-tax (reduce Box 1)
• FSA contributions (reduce Box 1)
• Section 125 cafeteria plan benefits (reduce Box 1)

Box 1 does NOT include:

• Employer’s share of health insurance (never your income)
• Employer 401(k) match (not your taxable income)

Why Box 1 is lower than your salary: If you earn $75,000, contribute $10,000 to your 401(k), and pay $3,600 in pre-tax health insurance, your Box 1 wages = $75,000 − $10,000 − $3,600 = $61,400.

Box 2: Federal Income Tax Withheld

The total federal income tax your employer withheld from your paychecks during the year. This flows directly to Form 1040 as a tax payment already made.

If Box 2 exceeds your actual tax liability, you get a refund. If it’s less, you owe the difference.

Boxes 3 and 4: Social Security Wages and Tax

Box	What It Shows
3	Social Security wages (capped at $176,100 in 2026)
4	Social Security tax withheld (6.2% of Box 3, max $10,918.20)

Box 3 ≠ Box 1 in many cases. Here’s why:

• Traditional 401(k) contributions reduce Box 1 but NOT Box 3 — FICA applies to 401(k) deferrals even though they reduce federal income tax
• Health insurance premiums paid through a Section 125 plan reduce both Box 1 and Box 3
• HSA payroll deductions reduce both Box 1 and Box 3

If Box 4 shows more than $10,918.20, your employer made an error (or you had multiple employers — see below).

Boxes 5 and 6: Medicare Wages and Tax

Box	What It Shows
5	Medicare wages (no wage cap — all wages included)
6	Medicare tax withheld (1.45% of Box 5)

Box 5 is typically equal to or slightly higher than Box 3, since there is no Medicare wage cap. Box 5 and Box 3 differ if your wages exceed $176,100 (SS stops; Medicare continues).

If your Medicare wages exceed $200,000 (single filer) or $250,000 (MFJ), your employer also withholds an additional 0.9% for the Additional Medicare Tax, also shown in Box 6.

Box 7: Social Security Tips

If you received tips and reported them to your employer, those are shown here. Combined with Box 3, they must not exceed $176,100.

Box 12: Benefits and Contributions (Codes)

Box 12 can have up to four entries, each with a code. The most common codes:

Code	Meaning
D	Traditional 401(k) contributions (pre-tax)
E	403(b) contributions
G	457(b) deferred compensation
W	Employer + employee HSA contributions
DD	Cost of employer-sponsored health coverage (informational only, not taxable)
AA	Roth 401(k) contributions (post-tax)
BB	Roth 403(b) contributions
EE	Roth 457(b) contributions
FF	Qualified small employer health reimbursement (QSEHRA)

Code DD (employer health insurance) is often the largest number and is purely informational — it does not affect your taxes.

Box 13: Checkboxes

Three checkboxes that affect your tax situation:

• Statutory employee: Special rules apply — income reported on Schedule C
• Retirement plan: If checked, your ability to deduct a traditional IRA may be limited based on your income
• Third-party sick pay: Sick pay from an insurance company rather than your employer directly

The Retirement plan checkbox is important if you plan to deduct a traditional IRA contribution.

Box 14: Other

Employers use Box 14 for miscellaneous items that don’t fit elsewhere. Common entries:

• State disability insurance (SDI) paid
• Union dues
• Health insurance premiums (for reference only)
• Employer-paid tuition assistance
• Vehicle benefit amounts

Box 14 items are generally informational and don’t affect your federal return, but some states require certain Box 14 amounts to be reported.

Boxes 15–17: State Taxes

Box	What It Shows
15	State abbreviation + employer state tax ID
16	State wages (often same as Box 1, sometimes different)
17	State income tax withheld

Box 16 and Box 17 flow into your state tax return. Some states have different rules for pre-tax deductions (e.g., New Jersey does not exclude 401(k) from state wages), which is why Box 16 may differ from Box 1.

Multiple W-2s from One Employer

If you changed payroll systems mid-year, your employer may issue two W-2s. Add the boxes together when filing — they are treated as a single employer for purposes of the Social Security wage cap.

Multiple W-2s from Different Employers

If you worked two jobs, you’ll get a W-2 from each. Enter both on your tax return. Watch for Social Security over-withholding: if combined Box 3 wages across all W-2s exceed $176,100, you may have paid more than the maximum $10,918.20 Social Security tax. The excess is refunded as a credit on your Form 1040 (Schedule 3, Line 11).