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Posted

I'm trying to figure out the difference between W-2 wages and 415 compensation and it's driving me nuts. In particular, I'm trying to find out what the differences are between 415 compensation and a definition of compensation that includes W-2 wages and elective deferrals (125, 132(f)(4) etc...). Could someone please help?

Posted

The difference generally relates to amounts realized on the the exercise of nonqualified stock options and distributions from nonqualified plans (both of which are generally includible in W-2 wages).

Posted

415 usually includes all income that is subject to income tax. This could include the fair value of a company car, certain reimbursed expenses, a home that is not paid for by the employee, etc.

Posted

Thank you!

Posted

However, it may not be subject to withholding (not sure) and there is a definition of compensation that excludes that comp under the 3401 definition.

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