Hi @Opus 17 thanks for your reply!
Unfortunately, I don't see why changing Box 1 and Box 16 (to not account for the income reduction) is appropriate here; if we do that, based on Boxes 4 & 6 it will appear as if I paid less Social Security and Medicare than I should have, which is false. Given that my entire income on this W-2 is subject to Social Security & Medicare, I think that Boxes 1, 3 and 5 should match.
I still think that they should correct Boxes 4 and 6 to include the over-collected Social Security and Medicare taxes that were part of the bonus. In my opinion, this would be a stronger proof of the over-collection.
I will see what their response is on whether they prefer to issue a direct refund or correct the W-2. If they refuse both I will report this to the IRS before seeking legal action.
