Why is box 12c on my W-2 showing employer contributing the entire amount when I paid most of it?

I'm so confused about my W-2 this year and hoping someone can help me figure this out. I contributed $4200 to my retirement account through payroll deductions, and my employer added another $1350 as their contribution. But when I look at box 12c on my W-2, it shows that my employer contributed the entire $5550! That doesn't seem right to me at all. When I'm doing my taxes and I change the amount to show only the $1350 employer contribution and enter the $4200 that I actually contributed (which was pre-tax, but I can only find the option to enter what I contributed outside of payroll), my federal taxes due drops by a LOT. Like surprisingly a lot. Am I doing something wrong here? Is this normal for box 12c to show everything as employer contribution even when most of it came from my paycheck? I don't want to mess up my taxes and either pay way too much or get in trouble later. Any help would be really appreciated!!

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18 comments

Rajan Walker

•8M

The confusion you're experiencing is actually pretty common! Box 12c on your W-2 is showing the combined total of both your contributions AND your employer's contributions, which is why you're seeing the full $5550 amount there. This is normal and how it's supposed to be reported. Your pre-tax contributions were already excluded from your taxable wages reported in Box 1 of your W-2. That's why when you're entering your tax information, you shouldn't be making additional adjustments to show "your contribution" separately - it's already been accounted for in your reduced taxable income. When you manually change the amount and try to indicate that you contributed separately, you're essentially double-counting the tax benefit of your contributions, which is why your tax due decreases so dramatically. The system is working correctly by showing the full amount in Box 12c.

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Rajan Walker

•8M

Yes, that's exactly right! If you contribute 10% of your salary and your employer matches 5%, Box 12c would show the combined amount, which would be 15% of your salary. Your W-2's Box 1 (taxable wages) would already be reduced by your 10% contribution since it's pre-tax, and Box 12c simply shows the total retirement contributions, both yours and your employer's. The key thing to remember is that you don't need to report your own contributions separately when filing taxes - they've already been accounted for in your reduced taxable income in Box 1.

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Lukas Fitzgerald

•8M

I had this exact same issue last year and spent hours trying to figure it out. I eventually found this amazing service called taxr.ai (https://taxr.ai) that really helped me understand what was going on with my W-2. I uploaded my forms and it explained everything, including why box 12c shows the combined total and how it affects my taxes. The software walked me through exactly how retirement contributions work on W-2s and explained that my pre-tax contributions had already been excluded from my reported wages in Box 1. It saved me from accidentally claiming the deduction twice which would have been a headache if I got audited.

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Lukas Fitzgerald

•8M

For Roth 401k contributions, they still appear in box 12c but will have a different code - often "AA" instead of "D" for traditional 401k contributions. Even though Roth contributions are after-tax, they still count toward your annual contribution limit, which is why they're reported. Regarding your question about comparing it to other tax software - what I found different was it actually explained WHY certain numbers appear where they do on tax forms. Most tax software just tells you where to enter numbers but doesn't explain the reasoning behind them. I could literally ask questions about my specific situation and get explanations that made sense.

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Avery Davis

•8M

I need to follow up about that taxr.ai site I was skeptical about. I ended up giving it a try with my W-2 and retirement account questions, and I have to say I was wrong! It actually did explain everything super clearly. I've been contributing to my 401k for 5 years and never understood why the W-2 reporting worked that way. The site showed me how to check that my Box 1 wages were already reduced by my contribution amount, which confirmed everything was reported correctly. It was actually a relief to understand this properly instead of just blindly trusting that my taxes were being done right. Definitely helped clear up my confusion about how retirement contributions are reported and taxed.

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Collins Angel

•8M

If you're still confused about this and need to talk to an actual IRS agent about it (which honestly might be the best move for peace of mind), I'd recommend Claimyr (https://claimyr.com). I was in a similar situation last year with confusion about retirement contributions and needed to confirm I was doing everything right. After waiting on hold with the IRS for like two hours and giving up multiple times, I found Claimyr and they got me connected to an IRS rep in about 20 minutes. They have this callback system that basically waits on hold for you - you can see how it works here: https://youtu.be/_kiP6q8DX5c. The IRS agent confirmed exactly what others are saying here about Box 12c showing combined totals and explained how it all works with pre-tax contributions.

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Collins Angel

•8M

The service basically uses an automated system to navigate the IRS phone tree and wait on hold for you. Once they reach a real person, you get a call connecting you directly to that IRS agent. You don't have to sit there listening to hold music for hours. For the skeptics - I was in the same boat. I'd tried calling the IRS three separate times about my retirement contribution reporting and gave up each time after being on hold forever. This service actually works - they have a system that just handles the waiting part, and then you only get called when there's an actual human ready to talk.

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Tate Jensen

•8M

I have to admit I was completely wrong about that Claimyr service. After complaining here, I decided to give it a shot because I was still confused about how my retirement contributions should be reported. It actually worked exactly as described - I got a call back in about 35 minutes connecting me to an IRS agent. The agent confirmed what everyone here was saying about Box 12c showing the combined total of both employee and employer contributions. She explained that my pre-tax contributions were already excluded from my taxable wages in Box 1, which is why I shouldn't be entering them separately when filing my taxes. Saved me from potentially making a costly mistake and having to deal with an amended return later. I honestly can't believe I finally got definitive answers from the IRS after months of confusion.

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Adaline Wong

•8M

I'm a payroll administrator, and I see this confusion all the time with employees. The way Box 12c works is that it shows the TOTAL CONTRIBUTIONS to qualified plans, not just what the employer contributed. Your contributions were already taken out pre-tax, meaning they've already reduced your taxable wages in Box 1. If you were to enter your contributions separately when filing taxes, you'd essentially be double-dipping on the tax benefit. That's why your tax due dropped dramatically when you did that - but it would be incorrect and could potentially trigger an audit.

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Adaline Wong

•8M

Yes, that's exactly right! You should use the W-2 exactly as is and not try to separate your contributions from your employer's when filing. The tax software is designed to handle this correctly when you enter your W-2 information as it appears on the form. Your pre-tax contributions have already reduced your taxable wages in Box 1, which is the primary tax benefit. Box 12c simply reports the total qualified retirement plan contributions for informational purposes and to ensure compliance with annual contribution limits. Trying to separate them out would incorrectly give you a double tax benefit.

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