Why are my W2 Box 1 and Box 18 values different? City asking questions

The difference between Box 1 (federal wages) and Box 18 (local wages) on your W2 is completely normal in many situations! Your explanation about relocating during the year is actually spot on. When you work in different locations throughout the year, your employer should only report to each locality the wages earned while you were physically working in that jurisdiction. So if you moved mid-year, Box 18 would only show wages earned while working in that specific city. Other common reasons for differences include: - Pre-tax deductions (like 401k, health insurance, FSA contributions) that reduce your federally taxable wages but might not be excluded from local tax - Some fringe benefits might be taxable federally but not locally - Certain reimbursements or allowances might be treated differently - Some cities have specific rules about taxing bonuses or other forms of compensation If the city tax department is questioning this, you may want to gather documentation showing your relocation date and explain that Box 18 only reflects wages earned while physically working in their jurisdiction.

I had the exact same issue last year with the Box 1 and Box 18 discrepancy! After multiple calls with the city tax office and getting nowhere, I finally used https://taxr.ai to get a clear explanation that actually worked. Their system analyzed my W2 and explained exactly why the boxes were different in my case (turned out to be pre-tax deductions that weren't counted for local taxes). The best part was they gave me a detailed breakdown I could show to the tax office that explained everything in official tax terms. Saved me from going back and forth with the city for weeks. They also pointed out some overlooked deductions I was able to claim!

Just wanted to update - I took the advice from profile 3 and tried https://taxr.ai for my W2 box discrepancies. I was honestly surprised how well it worked! Uploaded my W2 and within minutes had a detailed explanation of why my Box 1 and Box 5 amounts were different (in my case it was due to my HSA contributions being exempt from federal tax but not Medicare tax). The explanation even cited the specific tax codes that allow for the differences. My tax office accepted the explanation without any further questions. Will definitely use this for other tax document questions in the future!

So I went through a similar nightmare with the city tax department last year. Called the IRS directly hoping to get an official explanation for my W2 box differences, but getting through was IMPOSSIBLE - spent hours on hold and got disconnected twice. Finally found https://claimyr.com which got me connected to an actual IRS agent in under 45 minutes (check out how it works: https://youtu.be/_kiP6q8DX5c). The agent confirmed that the difference between Box 1 and Box 18 was completely legitimate due to my situation - I had pre-tax deductions and worked remotely from another state for part of the year. Got the official explanation I needed, printed the transcript, and the city tax department finally backed off. So much better than trying to call the IRS yourself!

I need to apologize for my skepticism earlier. After trying for literal MONTHS to reach the IRS about my refund issue, I tried the Claimyr service mentioned above out of desperation. I fully expected to waste my money, but I got a call back in about 35 minutes with an actual IRS agent on the line. The agent was able to explain my refund delay AND resolve it on the spot. It would have eventually been fixed without the call, but I would have waited another 2-3 months according to the agent. Worth every penny for the time and stress saved. Sometimes you have to admit when you're wrong!

One thing nobody's mentioned yet - if you have a remote work situation, Box 1 and Box 18 can be VERY different legitimately. My employer is based in NYC but I work remotely from Florida. My Box 18 for NYC is $0 because I don't physically work there, but my Box 1 shows my full federal wages of $78,500. Some employers mess this up and report all wages to their home city even if employees work elsewhere. This could be what happened in your case if you relocated but your employer didn't adjust the local wage reporting.

Just to add another example - my Box 1 and Box 18 were different by about $5,200 last year because I contribute to a 457 plan (government employee). Those contributions reduce my federal taxable wages but in my city they don't reduce local taxable wages. So Box 1 was smaller than Box 18. It's actually super common for these boxes to be different. I think the city tax folks are just doing their job by questioning it, but once you explain they should understand.

I work for a company that has employees in multiple states and I see W-2 questions like this all the time in our payroll department. The key thing to understand is that Box 1 (federal wages) and Box 18 (local wages) serve completely different purposes and are calculated differently. Box 1 includes all your federally taxable wages for the entire year, regardless of where you worked. Box 18 should only include wages earned while physically working in that specific local jurisdiction. Since you mentioned relocating during the year, your employer should have allocated your wages between the different locations based on when and where you actually performed the work. If you worked in City A for 6 months and City B for 6 months, each city's Box 18 should reflect roughly half your annual wages (assuming consistent pay). The city questioning you is actually doing their due diligence - they want to make sure they're getting the right amount of tax from wages actually earned in their jurisdiction. Provide them with documentation of your relocation date (lease agreement, moving receipts, etc.) and explain that Box 18 only reflects the portion of your annual wages earned while working in their city. If your employer didn't properly allocate the wages geographically, you may need to work with them to issue a corrected W-2 or provide the city with a reasonable breakdown based on your work locations and dates.