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Tax Planning Us 2007 Taxes

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Tax Planning Us 2007 Taxes

Tax planning us 2007 taxes 5. Tax planning us 2007 taxes   How To Get Tax Help Table of Contents Go online, use a smart phone, call or walk in to an office near you. Tax planning us 2007 taxes Whether it's help with a tax issue, preparing your tax return or picking up a free publication or form, get the help you need the way you want it. Tax planning us 2007 taxes Free help with your tax return. Tax planning us 2007 taxes    Free help in preparing your return is available nationwide from IRS-certified volunteers. Tax planning us 2007 taxes The Volunteer Income Tax Assistance (VITA) program is designed to help low-to-moderate income, elderly, persons with disabilities, and limited English proficient taxpayers. Tax planning us 2007 taxes The Tax Counseling for the Elderly (TCE) program is designed to assist taxpayers age 60 and older with their tax returns. Tax planning us 2007 taxes Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Tax planning us 2007 taxes Some VITA and TCE sites provide taxpayers the opportunity to prepare their return with the assistance of an IRS-certified volunteer. Tax planning us 2007 taxes To find the nearest VITA or TCE site, visit IRS. Tax planning us 2007 taxes gov or call 1-800-906-9887. Tax planning us 2007 taxes   As part of the TCE program, AARP offers the Tax-Aide counseling program. Tax planning us 2007 taxes To find the nearest AARP Tax-Aide site, visit AARP's website at www. Tax planning us 2007 taxes aarp. Tax planning us 2007 taxes org/money/taxaide or call 1-888-227-7669. Tax planning us 2007 taxes   For more information on these programs, go to IRS. Tax planning us 2007 taxes gov and enter “VITA” in the search box. Tax planning us 2007 taxes Internet. Tax planning us 2007 taxes IRS. Tax planning us 2007 taxes gov and IRS2Go are ready when you are — every day, every night, 24 hours a day, 7 days a week. Tax planning us 2007 taxes Apply for an Employer Identification Number (EIN). Tax planning us 2007 taxes Go to IRS. Tax planning us 2007 taxes gov and enter Apply for an EIN in the search box. Tax planning us 2007 taxes Request an Electronic Filing PIN by going to IRS. Tax planning us 2007 taxes gov and entering Electronic Filing PIN in the search box. Tax planning us 2007 taxes Check the status of your 2013 refund with Where's My Refund? Go to IRS. Tax planning us 2007 taxes gov or the IRS2Go app, and click on Where's My Refund? You'll get a personalized refund date as soon as the IRS processes your tax return and approves your refund. Tax planning us 2007 taxes If you e-file, your refund status is usually available within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Tax planning us 2007 taxes Check the status of your amended return. Tax planning us 2007 taxes Go to IRS. Tax planning us 2007 taxes gov and enter Where's My Amended Return in the search box. Tax planning us 2007 taxes Download forms, instructions, and publications, including some accessible versions. Tax planning us 2007 taxes Order free transcripts of your tax returns or tax account using the Order a Transcript tool on IRS. Tax planning us 2007 taxes gov or IRS2Go. Tax planning us 2007 taxes Tax return and tax account transcripts are generally available for the current year and past three years. Tax planning us 2007 taxes Figure your income tax withholding with the IRS Withholding Calculator on IRS. Tax planning us 2007 taxes gov. Tax planning us 2007 taxes Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Tax planning us 2007 taxes Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Tax planning us 2007 taxes gov. Tax planning us 2007 taxes Locate the nearest Taxpayer Assistance Center using the Office Locator tool on IRS. Tax planning us 2007 taxes gov or IRS2Go. Tax planning us 2007 taxes Stop by most business days for face-to-face tax help, no appointment necessary — just walk in. Tax planning us 2007 taxes An employee can explain IRS letters, request adjustments to your tax account or help you set up a payment plan. Tax planning us 2007 taxes Before you visit, check the Office Locator for the address, phone number, hours of operation and the services provided. Tax planning us 2007 taxes If you have an ongoing tax account problem or a special need, such as a disability, you can request an appointment. Tax planning us 2007 taxes Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Tax planning us 2007 taxes Locate the nearest volunteer help site with the VITA Locator Tool on IRS. Tax planning us 2007 taxes gov. Tax planning us 2007 taxes Low-to-moderate income, elderly, persons with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Tax planning us 2007 taxes The Tax Counseling for the Elderly (TCE) program helps taxpayers 60 and older with their tax returns. Tax planning us 2007 taxes Most VITA and TCE sites offer free electronic filing and some provide IRS-certified volunteers who can help prepare your tax return. Tax planning us 2007 taxes AARP offers the Tax-Aide counseling program as part of the TCE program. Tax planning us 2007 taxes Visit AARP's website to find the nearest Tax-Aide location. Tax planning us 2007 taxes Research your tax questions. Tax planning us 2007 taxes Search publications and instructions by topic or keyword. Tax planning us 2007 taxes Read the Internal Revenue Code, regulations, or other official guidance. Tax planning us 2007 taxes Read Internal Revenue Bulletins. Tax planning us 2007 taxes Sign up to receive local and national tax news by email. Tax planning us 2007 taxes Phone. Tax planning us 2007 taxes You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Tax planning us 2007 taxes Download the free IRS2Go mobile app from the iTunes app store or from Google Play. Tax planning us 2007 taxes Use it to watch the IRS YouTube channel, get IRS news as soon as it's released to the public, order transcripts of your tax returns or tax account, check your refund status, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Tax planning us 2007 taxes Call to locate the nearest volunteer help site, 1-800-906-9887. Tax planning us 2007 taxes Low-to-moderate income, elderly, persons with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Tax planning us 2007 taxes The Tax Counseling for the Elderly (TCE) program helps taxpayers 60 and older with their tax returns. Tax planning us 2007 taxes Most VITA and TCE sites offer free electronic filing. Tax planning us 2007 taxes Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Tax planning us 2007 taxes Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. Tax planning us 2007 taxes Call to check the status of your 2013 refund, 1-800-829-1954 or 1-800-829-4477. Tax planning us 2007 taxes The automated Where's My Refund? information is available 24 hours a day, 7 days a week. Tax planning us 2007 taxes If you e-file, your refund status is usually available within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Tax planning us 2007 taxes Before you call, have your 2013 tax return handy so you can provide your social security number, your filing status, and the exact whole dollar amount of your refund. Tax planning us 2007 taxes Where's My Refund? can give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Tax planning us 2007 taxes Where's My Refund? includes information for the most recent return filed in the current year and does not include information about amended returns. Tax planning us 2007 taxes Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. Tax planning us 2007 taxes Call to order forms, instructions and publications, 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions and publications, and prior-year forms and instructions (limited to 5 years). Tax planning us 2007 taxes You should receive your order within 10 business days. Tax planning us 2007 taxes Call to order transcripts of your tax returns or tax account, 1-800-908-9946. Tax planning us 2007 taxes Follow the prompts to provide your Social Security Number or Individual Taxpayer Identification Number, date of birth, street address and ZIP code. Tax planning us 2007 taxes Call for TeleTax topics, 1-800-829-4477, to listen to pre-recorded messages covering various tax topics. Tax planning us 2007 taxes Call to ask tax questions, 1-800-829-1040. Tax planning us 2007 taxes Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. Tax planning us 2007 taxes The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. Tax planning us 2007 taxes These individuals can also contact the IRS through relay services such as the Federal Relay Service available at www. Tax planning us 2007 taxes gsa. Tax planning us 2007 taxes gov/fedrelay. Tax planning us 2007 taxes Walk-in. Tax planning us 2007 taxes You can find a selection of forms, publications and services — in-person, face-to-face. Tax planning us 2007 taxes Products. Tax planning us 2007 taxes You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Tax planning us 2007 taxes Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. Tax planning us 2007 taxes Services. Tax planning us 2007 taxes You can walk in to your local TAC most business days for personal, face-to-face tax help. Tax planning us 2007 taxes An employee can explain IRS letters, request adjustments to your tax account, or help you set up a payment plan. Tax planning us 2007 taxes If you need to resolve a tax problem, have questions about how the tax law applies to your individual tax return, or you are more comfortable talking with someone in person, visit your local TAC where you can talk with an IRS representative face-to-face. Tax planning us 2007 taxes No appointment is necessary—just walk in. Tax planning us 2007 taxes Before visiting, check www. Tax planning us 2007 taxes irs. Tax planning us 2007 taxes gov/localcontacts for hours of operation and services provided. Tax planning us 2007 taxes Mail. Tax planning us 2007 taxes You can send your order for forms, instructions, and publications to the address below. Tax planning us 2007 taxes You should receive a response within 10 business days after your request is received. Tax planning us 2007 taxes  Internal Revenue Service 1201 N. Tax planning us 2007 taxes Mitsubishi Motorway Bloomington, IL 61705-6613 The Taxpayer Advocate Service Is Here to Help You. Tax planning us 2007 taxes    The Taxpayer Advocate Service (TAS) is your voice at the IRS. Tax planning us 2007 taxes Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Tax planning us 2007 taxes What can TAS do for you?    We can offer you free help with IRS problems that you can't resolve on your own. Tax planning us 2007 taxes We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. Tax planning us 2007 taxes You face (or your business is facing) an immediate threat of adverse action. Tax planning us 2007 taxes You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. Tax planning us 2007 taxes   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Tax planning us 2007 taxes Here's why we can help: TAS is an independent organization within the IRS. Tax planning us 2007 taxes Our advocates know how to work with the IRS. Tax planning us 2007 taxes Our services are free and tailored to meet your needs. Tax planning us 2007 taxes We have offices in every state, the District of Columbia, and Puerto Rico. Tax planning us 2007 taxes How can you reach us?    If you think TAS can help you, call your local advocate, whose number is in your local directory and at www. Tax planning us 2007 taxes irs. Tax planning us 2007 taxes gov/advocate, or call us toll-free at 1-877-777-4778. Tax planning us 2007 taxes How else does TAS help taxpayers?    TAS also works to resolve large-scale, systemic problems that affect many taxpayers. Tax planning us 2007 taxes If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System at www. Tax planning us 2007 taxes irs. Tax planning us 2007 taxes gov/sams. Tax planning us 2007 taxes Low Income Taxpayer Clinics. Tax planning us 2007 taxes    Low Income Taxpayer Clinics (LITCs) serve individuals whose income is below a certain level and need to resolve tax problems such as audits, appeals, and tax collection disputes. Tax planning us 2007 taxes Some clinics can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Tax planning us 2007 taxes Visit www. Tax planning us 2007 taxes TaxpayerAdvocate. Tax planning us 2007 taxes irs. Tax planning us 2007 taxes gov or see IRS Publication 4134, Low Income Taxpayer Clinic List. Tax planning us 2007 taxes Prev  Up  Next   Home   More Online Publications
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Alternative Payment Plans & Hardship Information

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Make monthly payments through an installment agreement if you're not financially able to pay your tax debt immediately.

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The “What Ifs” for Struggling Taxpayers
Here are some “what if” scenarios and the possible tax impact.

Page Last Reviewed or Updated: 04-Feb-2014

The Tax Planning Us 2007 Taxes

Tax planning us 2007 taxes Publication 957 - Main Content Table of Contents 1. Tax planning us 2007 taxes What is Back Pay?Reporting Back Pay Back Pay Under a Statute Nonstatutory Back Pay Format for Report to the SSA Questions 2. Tax planning us 2007 taxes Special Wage PaymentsReporting Special Wage Payments Reporting Nonstatutory (Nonqualified) Stock Options as Special Wage Payments Nonqualified Deferred Compensation and Section 457 Plans Additional Reporting Examples for Nonqualified Deferred Compensation (NQDC) PlansSpecial rule for box 11 of Form W-2 (distributions and deferral in the same year). Tax planning us 2007 taxes 1. Tax planning us 2007 taxes What is Back Pay? Back pay is pay received in a tax year(s) for actual or deemed employment in an earlier tax year(s). Tax planning us 2007 taxes For social security coverage and benefit purposes, all back pay, whether or not under a statute, is wages if it is payment for covered employment. Tax planning us 2007 taxes Damages for personal injury, interest, penalties, and legal fees included with back pay awards are not wages. Tax planning us 2007 taxes Report all back pay. Tax planning us 2007 taxes However, the tax year(s) for which back pay is credited as wages for social security purposes is different if it is awarded under a statute. Tax planning us 2007 taxes See Back Pay Under a Statute , later, for more information. Tax planning us 2007 taxes Reporting Back Pay The Internal Revenue Service (IRS) and the SSA consider back pay awards to be wages. Tax planning us 2007 taxes However, for income tax purposes, the IRS treats all back pay as wages in the year paid. Tax planning us 2007 taxes Employers should use Form W-2, Wage and Tax Statement, or electronic wage reports to report back pay as wages in the year they actually pay the employee. Tax planning us 2007 taxes The SSA no longer accepts reports on tapes, cartridges, and diskettes. Tax planning us 2007 taxes Example. Tax planning us 2007 taxes In 2012, Terry Morris earned wages of $50,000. Tax planning us 2007 taxes In the same year, she received $100,000 in settlement of a back pay case against her employer that covered the periods January 2007 through December 2011. Tax planning us 2007 taxes Her employer properly reflected social security wages of $110,100 and Medicare wages of $150,000 on her 2012 Form W-2. Tax planning us 2007 taxes However, if an employer did not include back pay wages on a previously filed Form W-2, magnetic media, or electronically filed wage report, the employer should prepare a wage correction report, Form W-2c, Corrected Wage and Tax Statement, or electronically filed report, to add the back pay award to the wages previously reported. Tax planning us 2007 taxes Example. Tax planning us 2007 taxes If, in the above example, Terry Morris' employer had prepared her 2012 Form W-2 reporting social security and Medicare wages of only $50,000 each, the employer would have to correct that report. Tax planning us 2007 taxes A Form W-2c correcting the 2012 Form W-2 would show previously reported social security and Medicare wages of $50,000 and the correct amount of $110,100 for social security wages and $150,000 for Medicare wages. Tax planning us 2007 taxes SSA treatment of back pay under a statute. Tax planning us 2007 taxes   Under the law, the SSA credits back pay awarded under a statute to an individual's earnings record in the period(s) the wages should have been paid. Tax planning us 2007 taxes This is important because wages not credited to the proper year may result in lower social security benefits or failure to meet the requirements for benefits. Tax planning us 2007 taxes   However, back pay under statute payments will remain posted to the employee's social security earnings record in the year reported on Form W-2 (or Form W-2c) unless the employer or employee notifies the SSA (in a separate, special report) of the back pay under a statute payment. Tax planning us 2007 taxes Then, the SSA can allocate the statutory back pay to the appropriate periods. Tax planning us 2007 taxes   If a back pay award is not made under a statute, the SSA credits back pay as wages in the year paid. Tax planning us 2007 taxes    If employers do notify the SSA of this payment, they should prepare a special report (with the information noted below) and send it to: Social Security Administration Attn: CPS Back Pay Staff 7-B-15 SWT 1500 Woodlawn Drive Baltimore, MD 21241-0001 Be sure to send this special report to the above address because the SSA handles it separately from other reports. Tax planning us 2007 taxes    If you paid the back pay award in the same tax year to which it applies, report the wages on that year's Form W-2. Tax planning us 2007 taxes No further action is necessary. Tax planning us 2007 taxes Example. Tax planning us 2007 taxes In 2012, Judy Wilson received a salary of $30,000 and a back pay under statute award of $2,000 for the period January through June 2012. Tax planning us 2007 taxes Her employer properly reported wages of $32,000 for social security and Medicare on her 2012 Form W-2. Tax planning us 2007 taxes No further action is necessary. Tax planning us 2007 taxes Information the SSA needs to properly credit back pay under a statute (special report). Tax planning us 2007 taxes   After you complete the special report, you or the employee should send it to the SSA when or after you submit the Form W-2 (on paper or electronically) to the SSA for the year you pay the statutory back pay to the employee. Tax planning us 2007 taxes There is no statute of limitations on the filing of the special report to enable the SSA to allocate the wages. Tax planning us 2007 taxes The special report must include the following information. Tax planning us 2007 taxes The employer's name, address, and employer identification number (EIN). Tax planning us 2007 taxes A signed statement citing the federal or state statute under which the payment was made. Tax planning us 2007 taxes If the statute is not identified, the SSA will assume the payment was not under a statute and will not allocate to earlier period(s). Tax planning us 2007 taxes The name and telephone number of a person to contact. Tax planning us 2007 taxes The SSA may have additional questions concerning the back pay case or the individual employee's information. Tax planning us 2007 taxes A list of employees receiving the payment and the following information for each employee: The tax year you paid and reported the back pay. Tax planning us 2007 taxes The employee's social security number (SSN). Tax planning us 2007 taxes The employee's name (as shown on his or her social security card). Tax planning us 2007 taxes The amount of the back pay award excluding any amounts specifically designated otherwise, for example, damages for personal injury, interest, penalties, and legal fees. Tax planning us 2007 taxes The period(s) the back pay award covers (beginning and ending dates—month and year). Tax planning us 2007 taxes The other wages paid subject to social security and/or Medicare taxes and reported in the same year as the back pay award (if none, show zero)*. Tax planning us 2007 taxes Do not include the back pay award shown in that wage report. Tax planning us 2007 taxes If you originally submitted the report under an establishment number, show that number and the amount of money that is to remain under that establishment number. Tax planning us 2007 taxes The amount to allocate to each reporting period*. Tax planning us 2007 taxes This includes any amount you want allocated (if applicable) to the tax year of the award payment. Tax planning us 2007 taxes If you do not give the SSA specific amounts to allocate, the SSA does the allocation by dividing the back pay award by the number of months or years covered by the award. Tax planning us 2007 taxes *Note. Tax planning us 2007 taxes   For periods before January 1, 1978 (before January 1, 1981, for state and local government employers covered by a Section 218 agreement), show the wage amounts for each calendar quarter ending March 31, June 30, September 30, and December 31. Tax planning us 2007 taxes For all tax years, show and identify the social security and/or Medicare Qualified Government Employment (MQGE) wages (where applicable) separately. Tax planning us 2007 taxes MQGE is applicable to federal employees beginning in 1983, and for certain state and local government employees beginning in 1986. Tax planning us 2007 taxes For tax years 1991 and later, list the social security and Medicare wages separately. Tax planning us 2007 taxes If you originally reported the individual's wages under an establishment or payroll record unit number, show the amount of wages to remain in the award year for that number and furnish that number to the SSA along with the EIN. Tax planning us 2007 taxes Back Pay Under a Statute Back pay awarded under a statute is a payment by an employer following an award, determination, or agreement approved or sanctioned by a court or government agency responsible for enforcing a federal or state statute that protects an employee's right to employment or wages. Tax planning us 2007 taxes Examples of pertinent statutes include: Age Discrimination in Employment Act, Americans with Disabilities Act, Equal Pay Act, Fair Labor Standards Act, National Labor Relations Act, State minimum wage laws, and State statutes that protect rights to employment and wages. Tax planning us 2007 taxes Payments based on laws that have a similar effect to those listed above also may qualify as payments made under a statute. Tax planning us 2007 taxes Back pay awards, under some of the statutes listed above, may be compensation for personal injury and not pay for employment. Tax planning us 2007 taxes Such awards are not wages for social security coverage purposes. Tax planning us 2007 taxes If a court-approved or sanctioned settlement agreement states that the agreement is not an admission of discrimination, liability, or act of wrongdoing, the statement does not change the nature of a back pay award. Tax planning us 2007 taxes The payments made in such a settlement may still be back pay and wages under the rules discussed here. Tax planning us 2007 taxes Nonstatutory Back Pay A payment for back wages negotiated between an employer and employee without an award, determination, or agreement approved or sanctioned by a court or government agency, the payment is not made under a statute. Tax planning us 2007 taxes Delayed wage payments and retroactive pay increases resulting from union negotiation or payments under local ordinances or regulations are back pay and are wages. Tax planning us 2007 taxes However, they are not payments made under a statute. Tax planning us 2007 taxes If you are uncertain whether the back pay award was under a qualified statute, you may need to contact your personnel department or legal counsel or the attorney who filed the suit. Tax planning us 2007 taxes Format for Report to the SSA Use the format shown in Table 1, later, to send the SSA the information needed to properly credit back pay under a statute. Tax planning us 2007 taxes In a cover letter, include: Name and address of the employer, Statute under which you paid the back pay, Name and telephone number of the employer contact, and Signature of the reporting official. Tax planning us 2007 taxes Under certain circumstances, back pay may be a special wage payment and excluded from wages counted under the social security earnings test. Tax planning us 2007 taxes If you pay back pay to an employee age 61 or older, report it to the SSA in accordance with this section. Tax planning us 2007 taxes Read Special Wage Payments, later, for additional reporting instructions. Tax planning us 2007 taxes Questions If you have questions concerning back pay under a statute, call the SSA at 1-800-772-6270. Tax planning us 2007 taxes Exception. Tax planning us 2007 taxes   If you are a state or local government employer who was covered by an agreement under Section 218 of the Social Security Act before January 1, 1987, and you paid a back pay award before January 1, 1987, which you did not report to the SSA, contact your state Social Security Administrator's office. Tax planning us 2007 taxes Table 1. Tax planning us 2007 taxes Format for Report (Under Covering Letter) to Request SSA to Allocate Back Pay Under Statute Wages Employer's EIN: xx-xxxxxxx Tax Year in Which Award Payment Was Paid: 2012 (1) SSN and Employee Name (2)1 Award Amount and Period(s) (3)2,3 Other Soc. Tax planning us 2007 taxes Sec. Tax planning us 2007 taxes /Med. Tax planning us 2007 taxes Wages Paid In Award Year (4)3 Allocation     Soc. Tax planning us 2007 taxes Sec. Tax planning us 2007 taxes Med. Tax planning us 2007 taxes /MQGE Year Soc. Tax planning us 2007 taxes Sec. Tax planning us 2007 taxes Med. Tax planning us 2007 taxes /MQGE xxx-xx-xxxx HELEN T. Tax planning us 2007 taxes SMITH $100,000 1/2009 - 12/2012 $40,000 $40,000 2009 2010 2011 2012 $20,000 25,000 27,000 28,000 $20,000 25,000 27,000 28,000 xxx-xx-xxxx SAM W. Tax planning us 2007 taxes EVANS 30,000 7/89-12/91 -0- -0- 1989 1990 1991   6,000 12,000 12,000 xxx-xx-xxxx ROLAND S. Tax planning us 2007 taxes ADAMS 15,000 7/80-12/81 -0- -0- 9/80 12/80 1981 3,500 3,500 8,000   1Exclude amounts specifically designated as damages, penalties, etc. Tax planning us 2007 taxes  2Exclude the amount of back pay, if any, included in that amount. Tax planning us 2007 taxes  3For periods before January 1, 1978 (and for state and local government (Section 218) employers before January 1, 1981), show the wage amounts by calendar quarters. Tax planning us 2007 taxes The social security and/or Medicare Qualified Government Employment (MQGE) wages (where applicable) must be shown separately FOR ALL YEARS. Tax planning us 2007 taxes (Wages subject ONLY to MQGE would be shown in the Medicare/MQGE column; no wages would be shown in the Soc. Tax planning us 2007 taxes Sec. Tax planning us 2007 taxes column. Tax planning us 2007 taxes ) For tax years 1991 and later, the social security and Medicare wages must be listed separately. Tax planning us 2007 taxes Explanation of examples. Tax planning us 2007 taxes Helen T. Tax planning us 2007 taxes Smith–The back pay award, excluding interest, was $100,000 for the periods 1/2009-12/2012. Tax planning us 2007 taxes In 2012, this employee was also paid $40,000 in other wages. Tax planning us 2007 taxes (Her Form W-2 for 2012 reported $110,100 for social security and $140,000 for Medicare. Tax planning us 2007 taxes The SSA allocation will result in adjusted posted wages of $68,000 for social security and $68,000 for Medicare for 2012. Tax planning us 2007 taxes ) Sam W. Tax planning us 2007 taxes Evans–The back pay award was $30,000 for the periods 7/89-12/91. Tax planning us 2007 taxes This employee was hired in 1989 and was subject to MQGE only. Tax planning us 2007 taxes He was no longer employed by this governmental employer in 2012. Tax planning us 2007 taxes (His Form W-2 for 2012 reported $30,000 for social security and $30,000 for Medicare. Tax planning us 2007 taxes After the SSA allocation, he will not have any net posted wages for 2012. Tax planning us 2007 taxes ) Roland S. Tax planning us 2007 taxes Adams–The back pay award was $15,000 for the periods 7/80-12/81. Tax planning us 2007 taxes He was no longer employed by this state and local government (Section 218) employer in 2012. Tax planning us 2007 taxes (His Form W-2 for 2012 reported $15,000 for social security and $15,000 for Medicare; after the SSA allocation, he will not have any net posted wages for 2012. Tax planning us 2007 taxes ) If the state Social Security Administrator's office needs more information, they can contact the SSA at the following address:   Social Security Administration Office of Income Security Programs Office of Earnings and Program Integrity Policy 6401 Security Boulevard 2506 OPS Baltimore, MD 21235 2. Tax planning us 2007 taxes Special Wage Payments A special wage payment (SWP) is an amount paid by an employer to an employee (or former employee) for services performed in a prior year. Tax planning us 2007 taxes Employers should report to the SSA special wage payments made to employees and former employees who are recipients of social security retirement benefits. Tax planning us 2007 taxes Special wage payments made to a retired employee receiving social security or to an employee who continues to work while receiving social security benefits may reduce the benefits the individual receives if not reported to the SSA. Tax planning us 2007 taxes Special wage payments may include (but are not limited to): Accumulated sick and vacation pay, Back pay, Bonuses, Deferred compensation, Payments because of retirement, Sales commissions, Severance pay, and Stock options. Tax planning us 2007 taxes Note. Tax planning us 2007 taxes Payments made after retirement that are part of the normal payroll cycle should not be routinely reported as special wage payments. Tax planning us 2007 taxes Earnings Test. Tax planning us 2007 taxes   Benefits paid to a social security beneficiary under full retirement age may be reduced if the beneficiary continues to work. Tax planning us 2007 taxes The SSA uses the information in boxes 1, 3, and 5 of Form W-2 to determine the beneficiary's current year earnings. Tax planning us 2007 taxes Special wage payments, which are for services performed in a prior year, will increase the current year earnings on Form W-2, which also may result in a reduction in the beneficiary's benefits. Tax planning us 2007 taxes If a benefit is reduced because of a special wage payment, the beneficiary must get documentation from the employer before the SSA can restore the deducted portion. Tax planning us 2007 taxes Therefore, employer reports of special wage payments help prevent incorrect benefit reductions. Tax planning us 2007 taxes Reporting Special Wage Payments Employers must report special wage payments for income tax purposes and social security and Medicare taxes in the year received. Tax planning us 2007 taxes Report income, social security, and/or Medicare taxes for special wage payments on Form W-2. Tax planning us 2007 taxes See Nonqualified Deferred Compensation and Section 457 Plans, later, for reporting nonqualified deferred compensation plan deferrals and payments on Form W-2. Tax planning us 2007 taxes In addition, report to the SSA special wage payments made during the reporting year to retired employees and employees who continue to work while receiving social security benefits. Tax planning us 2007 taxes Submit reports after the close of the tax year. Tax planning us 2007 taxes To avoid delays in processing, submit reports in time to reach the SSA by April 1. Tax planning us 2007 taxes Use one of the following reporting methods. Tax planning us 2007 taxes Electronic reporting. Tax planning us 2007 taxes   Special wage payment files can be sent electronically by logging onto Business Services Online (BSO) via the socialsecurity. Tax planning us 2007 taxes gov website. Tax planning us 2007 taxes BSO enables organizations and authorized individuals to conduct business with and submit confidential information to the Social Security Administration. Tax planning us 2007 taxes You must register to use this website. Tax planning us 2007 taxes The web address is www. Tax planning us 2007 taxes socialsecurity. Tax planning us 2007 taxes gov/bso/bsowelcome. Tax planning us 2007 taxes htm. Tax planning us 2007 taxes   Use the specifications and record layout shown in  Table 2, later. Tax planning us 2007 taxes Only one file at a time may be submitted. Tax planning us 2007 taxes If your file is large (>10MB), or you have a slow internet connection, the transmission will be faster if the file is zipped. Tax planning us 2007 taxes A zipped file contains a file that has been compressed to reduce its file size. Tax planning us 2007 taxes WinZip and PKZIP are examples of acceptable compression packages. Tax planning us 2007 taxes   Electronic submissions not meeting the specifications in Table 2 will be rejected. Tax planning us 2007 taxes Paper listing. Tax planning us 2007 taxes   A paper listing can be used to report special wage payments to several employees. Tax planning us 2007 taxes Use the format shown in Table 3, later. Tax planning us 2007 taxes Submit paper listings to the local SSA office nearest your place of business. Tax planning us 2007 taxes Visit www. Tax planning us 2007 taxes socialsecurity. Tax planning us 2007 taxes gov/locator to find a Social Security office near you. Tax planning us 2007 taxes Form SSA-131. Tax planning us 2007 taxes   Use Form SSA-131 to report special wage payments made to an employee. Tax planning us 2007 taxes Also use this form to report nonqualified deferred compensation and section 457 plan deferrals and payments that could not be reported in box 11 of Form W-2. Tax planning us 2007 taxes    This image is too large to be displayed in the current screen. Tax planning us 2007 taxes Please click the link to view the image. Tax planning us 2007 taxes Publication 957 Reporting Back Pay to the Social Security Administration Instructions for Form SSA–131   EMPLOYER INSTRUCTIONS FOR COMPLETING SPECIAL WAGE PAYMENT FORM 1. Tax planning us 2007 taxes Provide the EIN that was used or will be used to report the employee's wages on the Form W-2. Tax planning us 2007 taxes 2. Tax planning us 2007 taxes Enter the date the employee retired. Tax planning us 2007 taxes Enter “Not Retired” if the employee has not retired. Tax planning us 2007 taxes 3. Tax planning us 2007 taxes Enter the date that the employee last performed services; was not expected to return to work; and was not subject to recall to render additional services. Tax planning us 2007 taxes This date should be the same as or earlier than the date in item “2”. Tax planning us 2007 taxes Enter “Not Retired” if the employee has not retired. Tax planning us 2007 taxes 4. Tax planning us 2007 taxes Enter the wages that were paid to the employee in the tax year that were for services that were performed in years prior to the tax year or that were paid on account of retirement. Tax planning us 2007 taxes  Examples (not all inclusive) of payments to be included: Payments in lieu of vacation that were earned in a year prior to the tax year. Tax planning us 2007 taxes Accumulated sick payments which were paid in a lump sum based on “retirement” as the sole condition of payment. Tax planning us 2007 taxes Accumulated sick payments paid at or after the date in item 3, which were earned in a year prior to the tax year. Tax planning us 2007 taxes Payments “on account of retirement”–dismissal, severance or termination pay paid because of retirement. Tax planning us 2007 taxes Bonuses which are paid pursuant to a prior contract, agreement or promise causing the employee to expect such payments regularly; or announced to induce the employee to work more steadily, rapidly or efficiently or to remain with the employer. Tax planning us 2007 taxes Stock Options. Tax planning us 2007 taxes   Do not include in item “4” payments: For annual, sick, holiday, or vacation pay if used (absence from work) prior to the date of retirement (earlier of items “2” or “3”). Tax planning us 2007 taxes That were reported or will be reported under “Nonqualified Plans” on the Form W-2. Tax planning us 2007 taxes That were deducted from the employee's wages and paid to a deferred compensation plan (e. Tax planning us 2007 taxes g. Tax planning us 2007 taxes , 401k). Tax planning us 2007 taxes Employees health and dental plan benefits (non-covered/non-taxable for Social Security Wages). Tax planning us 2007 taxes Bonuses earned and paid in the tax year. Tax planning us 2007 taxes 5. Tax planning us 2007 taxes Check whether payments listed in item 4 will be made for years after the tax year. Tax planning us 2007 taxes If yes, please show the amounts and years in which these will be paid, if known. Tax planning us 2007 taxes 6. Tax planning us 2007 taxes Nonqualified deferred compensation and section 457 plans only. Tax planning us 2007 taxes If you were unable to report nonqualified deferred compensation or section 457 plan payments and deferrals (contributions) on Form W-2 because both payments and deferrals occurred during the year, show the amount of wages earned by the employee during the tax year. Tax planning us 2007 taxes Generally, the wages earned will be the compensation reported in block 1 of Form W-2 less payments from a nonqualified deferred compensation (or 457) plan, but including any amounts deferred under the plan during the tax year (See IRS Publication 957). Tax planning us 2007 taxes Paperwork/Privacy Act Notice: This report is authorized by regulation 20 CFR 404. Tax planning us 2007 taxes 702. Tax planning us 2007 taxes The information that you provide will be used in making a determination regarding the amount of Social Security benefits payable to the above named individual. Tax planning us 2007 taxes While your response is voluntary, if you do not respond we may not be able to make a correct determination regarding the amount of Social Security benefits payable to the above named individual for the year in question. Tax planning us 2007 taxes We may also use the information you give us when we match records by computer. Tax planning us 2007 taxes Matching programs compare our records with those of other Federal, State, or local government agencies. Tax planning us 2007 taxes Many agencies may use matching programs to find or prove that a person qualifies for benefits paid by the Federal Government. Tax planning us 2007 taxes The law allows us to do this even if you do not agree to it. Tax planning us 2007 taxes Explanations about these and other reasons why information you provide us may be used or given out are available in Social Security Offices. Tax planning us 2007 taxes If you want to learn more about this, contact any Social Security Office. Tax planning us 2007 taxes The Paperwork Reduction Act: This information collection meets the clearance requirements of 44 U. Tax planning us 2007 taxes S. Tax planning us 2007 taxes C. Tax planning us 2007 taxes §3507, as amended by Section 2 of the Paperwork Reduction Act of 1995. Tax planning us 2007 taxes You are not required to answer these questions unless we display a valid Office of Management and Budget control number. Tax planning us 2007 taxes We estimate that it will take you about 20 minutes to read the instructions, gather the necessary facts, and answer the questions. Tax planning us 2007 taxes Form SSA-131 (8-2001) EF (06-2002)   Submit Form SSA-131 to the SSA office nearest your place of business. Tax planning us 2007 taxes Or, the employee can submit it to the SSA office handling the claim. Tax planning us 2007 taxes You or the employee must submit this form before the SSA can exclude the special wage payments for purposes of the earnings test. Tax planning us 2007 taxes If reporting on more than one employee, complete a separate Form SSA-131 for each employee or use the paper listing format (except for reporting nonqualified and section 457 plan deferrals and payments) in Table 3. Tax planning us 2007 taxes Do not report payments from nonqualified deferred compensation or section 457 plans that were reported in box 11 of Form W-2. Tax planning us 2007 taxes Use Form SSA-131 if deferrals to and payments from nonqualified or section 457 plans occurred during the tax year. Tax planning us 2007 taxes Reporting Nonstatutory (Nonqualified) Stock Options as Special Wage Payments A nonstatutory (nonqualified) option to purchase stock which is exercised in a year after the year in which the option was earned is a special wage payment. Tax planning us 2007 taxes It should not count for the social security earnings test. Tax planning us 2007 taxes Nonstatutory (nonqualified) options exercised as special wage payments by retired employees or employees who continue to work while receiving social security benefits should be reported by employers using the above reporting methods. Tax planning us 2007 taxes Nonqualified Deferred Compensation and Section 457 Plans A nonqualified deferred compensation plan is a plan or arrangement established and maintained by an employer for one or more of its employees that provides for the deferral of compensation, but does not meet the requirements for a tax-qualified deferred compensation plan. Tax planning us 2007 taxes For social security and Medicare purposes, deferred compensation plans for employees of state and local governments (section 457 plans) are treated the same as nonqualified plans. Tax planning us 2007 taxes Nonqualified and section 457 plans are reported differently than other special wage payments. Tax planning us 2007 taxes See Reporting Amounts Deferred to Nonqualified and Section 457 Plans below for specific instructions. Tax planning us 2007 taxes Reporting Amounts Deferred to Nonqualified and Section 457 Plans Generally, when the related services are performed, nonqualified deferred compensation is subject to social security and Medicare tax when deferred. Tax planning us 2007 taxes However, if nonqualified and section 457 plans contain provisions that delay the employee's right to receive payments from the plan, a period of substantial risk of forfeiture exists. Tax planning us 2007 taxes The plans' deferrals, or contributions, are not subject to social security and Medicare taxes until the period of substantial risk of forfeiture ends. Tax planning us 2007 taxes No risk of forfeiture. Tax planning us 2007 taxes   If there is no risk of forfeiture, report wage amounts deferred to a nonqualified deferred compensation or section 457 plan in box 3 (up to the wage base maximum) and/or box 5 of Form W-2. Tax planning us 2007 taxes Example. Tax planning us 2007 taxes Company X's nonqualified deferred compensation plan allows the deferral of up to $20,000 of employee salaries each year. Tax planning us 2007 taxes The plan has no risk of forfeiture. Tax planning us 2007 taxes In 2012, Employee A defers $20,000 to the plan from a total salary of $200,000. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 $200,000 Box 3* 110,100 Box 5 200,000 *Wage base maximum for tax year 2012 Risk of forfeiture lapses before retirement. Tax planning us 2007 taxes   If the substantial risk of forfeiture lapses before the employee retires, report all past contributions to the plan (or the value of the plan), including accumulated earned interest, in box 3 (up to the wage base maximum) and/or box 5 of Form W-2. Tax planning us 2007 taxes The accumulated deferrals are reported along with any other social security and Medicare wages earned during the year. Tax planning us 2007 taxes   Report in box 11 of Form W-2 the amount of deferrals, including any accumulated interest, that became taxable for social security and Medicare taxes during the year (but were for prior year services) because the deferred amounts were no longer subject to a substantial risk of forfeiture. Tax planning us 2007 taxes If the employee continues working, future deferrals are social security and Medicare wages when they are earned. Tax planning us 2007 taxes    Do not include in box 11 deferrals that are included in boxes 3 and/or 5 and that are for current year services. Tax planning us 2007 taxes Risk of forfeiture lapses at retirement. Tax planning us 2007 taxes   When an employee's right to a payment is contingent upon working until retirement, report all past contributions to the plan (or the value of the plan), including accumulated earned interest, as social security and/or Medicare wages in the year of retirement. Tax planning us 2007 taxes Add the amount to other wages paid in that year, and enter in box 3 (up to the wage base maximum) and/or box 5 of Form W-2. Tax planning us 2007 taxes   Report in box 11 of Form W-2 the amount of deferrals, including any accumulated interest, that became taxable for social security and Medicare taxes during the year (but were for prior year services) because the deferred amounts were no longer subject to a substantial risk of forfeiture. Tax planning us 2007 taxes    Do not include in box 11 deferrals that are included in boxes 3 and/or 5 and that are for current year services. Tax planning us 2007 taxes Example—risk of forfeiture. Tax planning us 2007 taxes At the end of the risk-of-forfeiture period for Company Y's nonqualified deferred compensation plan, Employee B's accumulated deferrals, plus interest earned by the plan, are $120,000, not including B's $20,000 deferral for this year. Tax planning us 2007 taxes B's wages, including this year's deferred amount, are $80,000. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 $60,000 Box 3* 110,100 Box 5 200,000 Box 11 120,000 *Wage base maximum for tax year 2012 Reporting Payments From Nonqualified and Nongovernmental Section 457 Plans When an employee or former employee retires and begins receiving payments (distributions) from a nonqualified or nongovernmental section 457 plan, report the payments in boxes 1 and 11 of Form W-2. Tax planning us 2007 taxes Report payments (distributions) from a governmental section 457 plan on Form 1099-R, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. Tax planning us 2007 taxes Example. Tax planning us 2007 taxes Employee D retired from the XYZ company and began receiving social security benefits. Tax planning us 2007 taxes XYZ paid D a $12,000 bonus upon retirement for sales made in a prior year, and D received $25,000 in payments from XYZ's nonqualified deferred compensation plan. Tax planning us 2007 taxes In addition, D agreed to continue performing services for XYZ, but on a part-time basis for wages of $15,000 per year. Tax planning us 2007 taxes D made no deferrals to the nonqualified plan this year. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 $52,000 Box 3 27,000 Box 5 27,000 Box 11 25,000 Report the $12,000 bonus to the SSA using electronic reporting, a paper listing, or Form SSA-131. Tax planning us 2007 taxes For more information, see Reporting Special Wage Payments , earlier. Tax planning us 2007 taxes Reporting Payments and Deferrals in the Same Year Do not complete box 11 when payments (distributions) are made from a nonqualified plan and deferrals are reported in boxes 3 and/or 5 of Form W-2 (including current year deferrals). Tax planning us 2007 taxes Report to the SSA on Form SSA-131 the total amount the employee earned during the tax year. Tax planning us 2007 taxes Normally, the amount earned is the amount reported in box 1 of Form W-2 less payments from a nonqualified or section 457 plan, but including any amounts deferred under the plan during the tax year. Tax planning us 2007 taxes See Form SSA-131 and its instructions, earlier. Tax planning us 2007 taxes Example. Tax planning us 2007 taxes Employee K retired this year from Company XYZ and began receiving social security benefits. Tax planning us 2007 taxes During the year he earned wages of $50,000 and deferred $35,000 of the wages into the company's nonqualified deferred compensation plan. Tax planning us 2007 taxes K also received $75,000 in payments from the company's nonqualified plan. Tax planning us 2007 taxes Form W-2 Completion Amount Special Wage Payment $75,000 Wages 50,000 Minus: deferral 35,000 Total reported in Box 1 $90,000     Wages including deferral reported in  Boxes 3 and 5 $50,000     Leave Box 11 blank. Tax planning us 2007 taxes File Form SSA-131 -0-     Form SSA-131 Completion Amount from Box 1 of Form W-2 $90,000 Minus: payments from a nonqualified plan 75,000 Plus: amounts deferred into the plan during the year 35,000 Total wages earned for purposes of Form SSA-131 (item 6) $50,000 Additional Reporting Examples for Nonqualified Deferred Compensation (NQDC) Plans It is not necessary to show amounts deferred during the year under an NQDC plan subject to section 409A. Tax planning us 2007 taxes If you report section 409A deferrals, show the amount in box 12 of Form W-2 using code Y. Tax planning us 2007 taxes For more information, see Notice 2008-115, 2008-52 I. Tax planning us 2007 taxes R. Tax planning us 2007 taxes B. Tax planning us 2007 taxes 1367, available at www. Tax planning us 2007 taxes irs. Tax planning us 2007 taxes gov/irb/2008-52_IRB/ar10. Tax planning us 2007 taxes html. Tax planning us 2007 taxes Special reporting rules apply when an NQDC plan is not compliant with section 409A (when there has been a “plan failure”). Tax planning us 2007 taxes Income included under section 409A from an NQDC plan is reported in box 1 and box 12 of Form W-2 using code Z. Tax planning us 2007 taxes See Notice 2008-115. Tax planning us 2007 taxes The following examples use small dollar amounts for illustrative purposes. Tax planning us 2007 taxes However, the amount reported in box 3 of Form W-2 is always limited by the social security earnings wage base (for example, $110,100 for 2012). Tax planning us 2007 taxes The term “vested” in the following examples means that the amount deferred is not subject to a substantial risk of forfeiture. Tax planning us 2007 taxes Conversely, the term “not vested” means that the amount deferred is subject to a substantial risk of forfeiture. Tax planning us 2007 taxes The examples assume that the NQDC plan is in compliance with section 409A, and that amounts deferred under the plan are not includible in gross income as they are deferred. Tax planning us 2007 taxes For purposes of the examples, it is assumed that the regular pay of the employee is remuneration for employment and wages for employment tax purposes except to the extent the deferral of a portion of the regular pay results in a reduction in wages. Tax planning us 2007 taxes Example 1: Deferral that is immediately vested (no substantial risk of forfeiture) with no distributions and no vesting of prior-year deferrals. Tax planning us 2007 taxes For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into her employer’s NQDC plan. Tax planning us 2007 taxes The deferral of $20 was vested upon deferral and there was an employer match of $10 under the plan, which was also vested. Tax planning us 2007 taxes Regular pay = $200; Deferral, vested = $20; Employer match, vested = $10. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($200 Regular pay minus $20 vested deferral) $180 Box 3 ($200 Regular pay plus $10 Employer match, vested) 210 Box 5 ($200 Regular pay plus $10 Employer match, vested) 210 Box 11 -0- Example 2: Deferral with delayed vesting (substantial risk of forfeiture) of employee and employer portions (no distributions and no vesting of prior-year deferrals). Tax planning us 2007 taxes For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s nonqualified deferred compensation plan. Tax planning us 2007 taxes The deferral of $20 was not vested upon deferral, and there was an employer match of $10 under the plan, which was also not vested. Tax planning us 2007 taxes Regular pay = $200; Deferral, not vested = $20; Employer match, not vested = $10. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($200 Regular pay minus $20 Deferral, not vested) $180 Box 3 ($200 Regular pay minus $20 Deferral, not vested) 180 Box 5 ($200 Regular pay minus $20 Deferral, not vested) 180 Box 11 -0- Example 3: Deferral that is immediately vested with prior-year deferrals and investment earnings on the prior-year deferrals that are now vesting (no distributions). Tax planning us 2007 taxes For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s nonqualified deferred compensation plan. Tax planning us 2007 taxes The deferral of $20 was vested upon deferral. Tax planning us 2007 taxes During the year, $100 of prior-year deferrals and $15 of investment earnings on the $100 of prior-year deferrals became vested. Tax planning us 2007 taxes Regular pay = $200; Deferral, vested = $20; Vesting of prior-year deferrals = $100; Vesting of investment earnings on $100 of prior-year deferral = $15. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($200 Regular pay minus $20 Deferral, vested) $180 Box 3 ($200 Regular pay plus $100 vested prior-year deferral plus $15 earnings on deferral) 315 Box 5 ($200 Regular pay plus $100 vested prior-year deferral plus $15 vested investment earnings on prior year deferral) 315 Box 11 ($100 vested prior-year deferral plus $15 earnings) 115 Example 4: No deferrals but there are distributions (no vesting of prior-year deferrals). Tax planning us 2007 taxes For the year, the employee’s regular pay was $100, and the employee deferred no pay into the employer’s NQDC plan. Tax planning us 2007 taxes There was no vesting of prior-year deferrals under the plan. Tax planning us 2007 taxes During the year, there were total distributions of $50 from the plan to the employee. Tax planning us 2007 taxes Regular pay = $100; Distribution = $50. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($100 Regular pay plus $50 Distribution) $150 Box 3 ($100 Regular pay ) 100 Box 5 ($100 Regular pay) 100 Box 11 ($50 Distribution) 50 Special rule for box 11 of Form W-2 (distributions and deferral in the same year). Tax planning us 2007 taxes   If, in the same year, there are NQDC distributions and there are deferrals that are reportable in boxes 3 and/or 5 (current or prior-year deferrals) of Form W-2, do not complete box 11. Tax planning us 2007 taxes Instead, report on Form SSA-131 the total amount the employee earned during the year. Tax planning us 2007 taxes * Submit the SSA-131 to the nearest SSA office or give it to the employee. Tax planning us 2007 taxes   *Generally, the amount earned by the employee during the tax year for purposes of item 6 of Form SSA-131 is the amount reported in box 1 of Form W-2 plus current-year deferrals that are vested (employee and employer portions) less distributions. Tax planning us 2007 taxes Do not consider prior-year deferrals that are vesting in the current year. Tax planning us 2007 taxes If there was a plan failure, the box 1 amount in this calculation should be as if there were no plan failure. Tax planning us 2007 taxes Example 5: Deferral that is immediately vested and there are distributions (no vesting of prior-year deferrals). Tax planning us 2007 taxes For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. Tax planning us 2007 taxes There was also an employer match of $10. Tax planning us 2007 taxes The deferral and employer match were vested upon deferral. Tax planning us 2007 taxes There was no vesting of prior-year deferrals under the plan. Tax planning us 2007 taxes During the year, there were total distributions of $50 from the plan to the employee. Tax planning us 2007 taxes Regular pay = $200; Deferral, vested = $20; Employer match, vested = $10; Distribution = $50. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 Regular pay minus $20 Deferral, vested) $230 Boxes 3 and 5 ($200 Regular pay plus $10 vested employer match) 210 Leave Box 11 blank. Tax planning us 2007 taxes File Form SSA-131 -0-     Form SSA-131 Completion Item 6 - amount of wages earned by the employee during the tax year ($230 from Box 1 of Form W-2 minus $50 Distribution plus $30 vested current year employee deferral and employer match) $210 Example 6: Deferral with delayed vesting and there are distributions (no vesting of prior-year deferrals). Tax planning us 2007 taxes For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. Tax planning us 2007 taxes The deferral was not vested upon deferral. Tax planning us 2007 taxes There was no vesting of prior-year deferrals under the plan. Tax planning us 2007 taxes During the year, there were total distributions of $50 from the plan to the employee. Tax planning us 2007 taxes Regular pay = $200; Deferral, not vested = $20; Distribution = $50. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 Regular pay minus $20 Deferral, not vested) $230 Boxes 3 and 5 ($200 Regular pay minus $20 deferral that is not vested) 180 Box 11 ($50 Distribution). Tax planning us 2007 taxes 50 Example 7: Deferral that is immediately vested and there are distributions (also vesting of prior-year deferrals and earnings on those prior-year deferrals). Tax planning us 2007 taxes For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. Tax planning us 2007 taxes The deferral was vested upon deferral. Tax planning us 2007 taxes There was vesting of $100 of prior-year deferrals and $15 of earnings on the $100 prior-year deferral under the plan. Tax planning us 2007 taxes During the year, there were total distributions of $50 from the plan to the employee. Tax planning us 2007 taxes Regular pay = $200; Deferral, vested = $20; Distribution = $50; Vesting of prior-year deferrals ($100) and earnings on those prior-year deferrals ($15) = $115. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 Regular pay minus $20 vested deferral $230 Boxes 3 and 5 ($200 Regular pay Plus $115 vested prior deferral (with vested earnings on the deferral)) 315 Leave Box 11 blank. Tax planning us 2007 taxes File Form SSA-131 -0-     Form SSA-131 Completion Item 6, amount of wages earned by the employee during the tax year ($230 from Box 1 of Form W-2 minus $50 Distribution plus $20 vested current year deferral) $200 Example 8: Deferral with delayed vesting and there are distributions (vesting of prior-year deferrals, including employer matches, and earnings on those deferrals). Tax planning us 2007 taxes For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. Tax planning us 2007 taxes The deferral was not vested upon deferral. Tax planning us 2007 taxes There was also vesting of prior-year deferrals and employer matches and earnings on these amounts under the plan ($115). Tax planning us 2007 taxes During the year, there were total distributions of $50 from the plan to the employee. Tax planning us 2007 taxes Regular pay = $200; Deferral, not vested = $20; Distribution = $50; Vesting of prior-year deferrals and employer match = $100 plus earnings on that $100 of $15. Tax planning us 2007 taxes Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 regular pay minus $20 Deferral, not vested) $230 Boxes 3 and 5 ($200 Regular pay plus $115 vested prior-year deferral and prior year employer match and earning on the prior year amounts minus $20 deferral that is not vested) 295 Leave Box 11 blank. Tax planning us 2007 taxes File Form SSA-131 -0-     Form SSA-131 Completion Item 6 ($230 Amount from Box 1 of Form W-2 minus $50 Distribution) $180 Table 2. Tax planning us 2007 taxes Specifications for Electronic Reporting of Special Wage Payments Record Position  Field Size   Description Start End 1 3 3 Record Type—must include only the capital letters “SWP” 4 12 9 SSN—must be numeric and may not be all zeros 13 27 15 Last Name—all capitals and no punctuation; may have blanks on right only 28 38 11 First Name—all capitals and no punctuation; may have blanks on right only 39 39 1 Middle Initial—must be either a capital letter or blank 40 48 9 EIN—must be numeric and may not be all zeros 49 59 11 Payment—must be numeric; may not be all zeros; last two digits on right are assumed to be cents; no period or dollar sign 60 63 4 Payment Year—must be only a four-digit year 64 66 3 SSA Office Code—must be numeric and may be all zeros 67 67 1 Payment Type Code—must be the capital letter “T” 68 117 50 Filler  The record format is a fixed length of 117. Tax planning us 2007 taxes  The file format is ASCII. Tax planning us 2007 taxes  Submit only one file at a time. Tax planning us 2007 taxes   Table 3. Tax planning us 2007 taxes Sample—Paper Listing for Reporting Special Wage Payments to Several Employees Report of Special Wage PaymentsTax Year: Page of A. Tax planning us 2007 taxes Employer Name: EIN:   Address: Contact Name:     Phone: ( )   . Tax planning us 2007 taxes 1) B. Tax planning us 2007 taxes Employee Name: (Last) (First) (MI)   C. Tax planning us 2007 taxes SSN: D. Tax planning us 2007 taxes SWP:$ E. Tax planning us 2007 taxes Type: Other: 2) B. Tax planning us 2007 taxes Employee Name: (Last) (First) (MI)   C. Tax planning us 2007 taxes SSN: D. Tax planning us 2007 taxes SWP:$ E. Tax planning us 2007 taxes Type: Other: 3) B. Tax planning us 2007 taxes Employee Name: (Last) (First) (MI)   C. Tax planning us 2007 taxes SSN: D. Tax planning us 2007 taxes SWP:$ E. Tax planning us 2007 taxes Type: Other: 4) B. Tax planning us 2007 taxes Employee Name: (Last) (First) (MI)   C. Tax planning us 2007 taxes SSN: D. Tax planning us 2007 taxes SWP:$ E. Tax planning us 2007 taxes Type: Other: 5) B. Tax planning us 2007 taxes Employee Name: (Last) (First) (MI)   C. Tax planning us 2007 taxes SSN: D. Tax planning us 2007 taxes SWP:$ E. Tax planning us 2007 taxes Type: Other:     INSTRUCTIONS:   Enter tax year and page number. Tax planning us 2007 taxes   A. Tax planning us 2007 taxes Employer name, employer identification number (EIN), address, the name of a contact person, and a phone number where the contact person can be reached during normal business hours. Tax planning us 2007 taxes   B. Tax planning us 2007 taxes Employee's name. Tax planning us 2007 taxes   C. Tax planning us 2007 taxes Employee's social security number (SSN). Tax planning us 2007 taxes   D. Tax planning us 2007 taxes Total amount of special wage payments made to the employee. Tax planning us 2007 taxes   E. Tax planning us 2007 taxes Type of special wage payment from the following list: (1) Vacation Pay, (2) Sick Pay, (3) Severance Pay,  (4) Bonus, (5) Deferred Compensation, (6) Stock Options, and (7) Other—Please explain. Tax planning us 2007 taxes   Do not use a paper listing for nonqualified deferred compensation and section 457 plan deferrals and payments that could not be reported in block 11 of Form W-2. Tax planning us 2007 taxes (Get Form SSA-131. Tax planning us 2007 taxes )                 Prev  Up  Next   Home   More Online Publications