Understanding your W-2 form

Why do the wages reported on my W-2 not match my true earnings?

Due to government regulations, pre-tax deductions, retirement, and annuity contributions deducted from your paycheck may not be included in wages subject to taxes. If you have none of these deductions or contributions on your paycheck, your W-2 wages will equal your true gross wages.

Following is a wage base table showing how gross wages for Boxes 1, 3, 5 and 16 on your W-2 are calculated. This corresponds with question 1 above.

Actual Gross Wages
+ Non-Wage Compensation (awards, courtesy cars, athletic meals, gift certifcates, etc.)
= True Wage Base
Pre-tax insurances
= Social Security Taxable Gross
Retirement
Annuities
= Federal and State Taxable Gross

Why are there four wage amounts listed on my W-2 form and why are they different amounts?

Government regulations determine how each type of wages are reported and taxed by the various federal and state agencies. Your W-2 will show one or more of the following types of wages:

  1. Box 1 – Wages, Tips, Other Compensation
    Wages subject to Federal income tax.
  2. Box 3 – Social Security Wages
    Wages that are subject to Social Security tax.
  3. Box 5 – Medicare Wages and Tips
    Wages subject to Medicare taxes.
    Your gross wages for Social Security and Medicare are reduced by “pre-tax” payroll deductions for health insurance, dental insurance, vision insurance, accidental death and disability insurance, NC Flex (dependent care and medical), Health Care Plus and also for pre-tax parking. If your Social Security wages exceeded $118,500; Social Security tax was withheld on the first $118,500 only since this is the maximum amount from which social security taxes could be withheld for 2015. Medicare has no maximum.
  4. Box 16 – State Wages, Tips, Etc.
    Wages subject to State income tax.
    Your gross wages for federal and state taxes are reduced by the same “pre-tax” payroll deductions as Social Security and Medicare. In addition, deductions for retirement and deferred compensation (annuities) contributions are also deducted.

What do the letters “D”, “E”, “G”, “AA” and “BB” in Box 12 reflect?

UNC employees may participate in five types of tax deferred annuity programs – Code Section 401(k), Roth 401(k), 403(b), Roth 403(b) and 457. IRS codes are explained on the back of W-2 Form “Copy 2 (File with State, City, and local taxes) and C (Employee’s Record.) Other important information is also documented there. For those employees who opted to print their own Form W-2 via ConnectCarolina Employee Self Service, the information that is usually on the back of the Form W-2 is located at the link titled “Filing Instructions.”

What is the amount reported with the letter “C” in Box 12 of W-2 Form?

Code “C” is reporting the taxable cost of the group-term life insurance over $50,000. This amount is taxable and is included in boxes 1, 3, 5 and 16.

What is the amount reported with the letter “DD” in Box 12 of my W-2 Form?

Code “DD” indicates the amount of employer paid health coverage under our employer-sponsored health plan. This amount is not taxable. The purpose is to provide employees with useful and comparable consumer information on the cost of their health care coverage.

What does the “Gift” description in box 14 mean?

The “Gift” description in box 14 stands for Awards, Gifts and/or Stipends (which is shortened to accommodate the 10 character limit).  The amount shown as “Gift” in box 14 is only informational, and is also included in your box 1 amount.

What should I do if the address listed for me on my W-2 is incorrect?

It is okay to submit a W-2 with your tax return in which the address printed on the W-2 does not reflect your home address. Therefore, Payroll Services does not re-issue or issue an amended form (i.e, W-2C – Corrected Wage and Tax Statement) due to an incorrect address. However, we recommend that you contact your HR Officer to have your address corrected in ConnectCarolina.

General Tax Questions

If I did not have any taxes withheld last year, do I still need to file an income tax return?

The amount of taxes withheld does not determine whether or not you should file a tax return. The requirement to file a return is based primarily on the amount earned, citizenship status, dependency status and age. Refer to the section titled “Do You Have to File?” in the federal tax Form 1040, Form 1040EZ, or Form 1040NR instructions for information. The forms are available at your local IRS and NC Department of Revenue offices and on their websites shown below. The University does not stock these individual tax forms. You may also call the Internal Revenue Service (IRS) at 1-800-829-1040 from 7 a.m. until 10 p.m. at all local time zones for help in determining your filing status.

Where can I get information about income taxation or request tax return forms?

What is the EIC and how do I find out if I qualify?

  1. EIC is an acronym for Earned Income Credit. You may also see it called ‘EITC’ for Earned Income Tax Credit. EIC is a refundable federal tax credit for working individuals who do not earn much money. If eligible, the tax credit can be claimed when you file your income tax return (EIC). The EIC is not available to nonresident alien individuals or to students who are exempt from social security taxes.
  2. For more detailed information on the EIC:

If you worked more than one job at UNC-Chapel Hill this year

Do I get a W-2 form for each job that I was paid for during the past calendar year?

No, you will receive a single W-2 that includes the combined wages and taxes for all jobs paid through Payroll Services at UNC-Chapel Hill.

How to get your W-2 and other forms

Can you fax my W-2 to me?

No, due to confidentiality issues we are unable to fax W-2s.

What if I lose my W-2 or I don’t receive it?

  1. Send a request to payroll@unc.edu. Please be sure to include your name, PID, last four digits of your Social Security Number and the address where it should be mailed.
  2. Foreign National Employees or Students with Nonresident Tax Status: If a Foreign National employee or student with nonresident tax status received a scholarship/fellowship from UNC-Chapel Hill or used a tax treaty to exempt some or all of their wages from federal and state withholding taxes, these amounts will be reported on a Form 1042-S, “Foreign Person’s U.S. Source Income Subject to Withholding.” The individual will receive a Form 1042-S wage/tax statement from the Payroll Services prior to March 15, 2016. Some individuals will receive both Forms W-2 and 1042-S.
  3. Form 1099-MISC: All questions concerning Form 1099-MISC (for non-payroll related payments paid to individuals through Accounts Payable) should be addressed to disbursementsteam@unc.edu.
  4. Form 1098-T: All questions pertaining to Form 1098-T (Education related expenses paid by students to the University Cashier) should be addressed to cashier@unc.edu.
  5. Form 1098-E: All questions pertaining to Form 1098-E (Student Loan interest paid by student borrowers to the University Cashier) should be addressed to loanrepay@unc.edu.

When will I receive my Form 1095-C?

Under the provisions of the Affordable Health Care act, employers will now be responsible for issuing Form 1095-C “Employer-Provided Health Insurance Offer and Coverage. For tax year 2016, the University must issue these forms to employees by March 2, 2017. The Benefits Office will be responsible for issuing these forms. Additional information about this form can be found on the Human Resources website or on the IRS website.