Box 1 wages and box 16 wages do not match on w2 state return rejected, if that is correct how do I answer part 3 pa-40x

 
PhyllisG
New Member

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There are several reasons box 1 and box 16 do not match (e.g. pre-tax transportation benefits or wages from two states.) It is best to contact your employer to determine the reason the amounts differ.

After doing so, a simple reason can be entered in Part 111 of the PA-40X. You can enter the  explanation your employer may provide you.

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If you participate in a 401k retirement plan and are reporting PA income, box 1 and box 16 will never match.  Federal allows your 401k contributions (box 12, code "D")to be deducted from your gross wages.  PA does not.

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That box 1 amt would be lower only if it is a Traditional 401K, right, not for a Roth 401K, right?

Cynthiad66
Expert Alumni

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Correct.  You receive a deduction on your income tax return because this contribution is not included in your wages in box 1 of your Form W-2. You pay income tax on the amount shown in box 1 on your Form W-2. Since the contribution to the 401(k) is not included in the box 1 amount, you do not pay tax on it.  @gmott18 

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