The National Directory of Certified Public Accountants

Ask A CPA - Form W-2

W-2 - Box 1 And Box 3 Differences

The amount in Box 1 can be unlimited but the amount in Box 3 and 7 should never exceed $ 106,800 in 2011. Also; Elective salary deferrals to a 401(k), 403(b) Simple, Salary reduction SEP as well as payments of adoption expenses and deferred amounts under a nonqualified plan or 457 plan are included in Box 3 and not in Box 1 Taxable wages.

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