W2 reportiing

[cripp12]

We are in the process of finalizing w2 for the nonqual plan. I have a conflict with box 1. One item I pulled says to include Income in Box 1 and Box 12 using code Z. Another item only mentions Box 12 using code Z.

Anyone know which is correct.

thank You

[XTitan]

According to the 2010 W-2 Instructions:

Income included under section 409A from an NQDC plan will be reported in box 1, and in box 12 using code Z.

[cripp12]

According to the 2010 W-2 Instructions:

Income included under section 409A from an NQDC plan will be reported in box 1, and in box 12 using code Z.

My understanding is that box 1 is for Federal wages and is taxable. I thought going forward that the earnings were only reportable for that year.

[XTitan]

I think you're confusing reporting of deferrals (Box 12 Code Y, which is not yet required) with reporting income due to violating 409A.

If it's a distribution from an NQDC plan that isn't a 409A violation, it's box 1 reporting as usual. If there is income recognition due to a violation of 409A, it's box 1 for income and box 12 code Z for the reporting of the 409A violation amount.

Hope this clarifies.

[cripp12]

I think you're confusing reporting of deferrals (Box 12 Code Y, which is not yet required) with reporting income due to violating 409A.

Hope this clarifies.

I thought 2009 was officially the year they needed to be reported.

[XTitan]

I thought 2009 was officially the year they needed to be reported.

W-2 Instructions (Page 1 under Reminders)

Reporting for nonqualified deferred compensation plans. You are not required to complete box 12 with code Y (deferrals under nonqualified plans subject to section 409A).

As per Notice 2008-113, Box 12 Code Y reporting won't be required until the income inclusion regs are finalized.