Box 12
The IRS uses all alphabetic codes to classify different types of employee earnings. When you set up DBAs that process employee earnings and benefits, you enter these codes to specify the types of earnings the DBA represents. When you attach the appropriate IRS code to DBAs, the system prints the amounts that are associated with the DBAs in Box 12 on the W-2 form.
Do not enter the codes A, B, M, or N for a DBA; they apply to FICA and Medicare taxes in arrears. The system tracks these amounts in the F06136 table, and it prints these amounts in Box 12 for those employees who have FICA or Medicare taxes in arrears.
Also, the W-2 IRS Defined Code field is a two-character field. Occasionally, the IRS requires you to report information that is more than two-characters in Box 12 of the W-2 form. Example: You are reporting contributions made to a 457(b) plan for makeup amounts under The Uniformed Services Employment and Reemployment Rights Act for a previous year. In Box 12 of the W-2 form, you must report the IRS code plus that year. Therefore, to correctly report a USD 2250.00 contribution to such a plan in tax year 2012, Box 12 of the W-2 form should read D 06 2250.00. Enter any additional characters in the additional information in the Special Handling Code Description field on the DBA. Example: On the DBA used to calculate makeup contributions, enter the following information:
W-2 IRS Defined Code field: Blank
Special Handling Code Description field: D 02
The system uses this information, along with the amounts in payroll history, to report the information correctly on the year-end form.