@imangoldasteh No, you can't deduct anything by making an entry in box 12 on your W-2 form. What is reported in box 1 on your W-2 form will show as your wage income on your tax return, box 12 is just used to report the reason box 1 may be different from your gross wages, normally reported in box 3.
If you need to report additional income, you can use the Less Common Income method to do that, but you can't then adjust that amount by manipulating your W-2 entries. You need to enter your W-2 entry the way it is reported on the form.
If you are adding unreported wage income because you contributed too much to your 401-K, then it seems you are not being double taxed, since the amount in box 1 on your W-2 and the amount you are adding as Less Common Income would bring you up to the correct taxable wage income total.
@imangoldasteh
[Edited 2/21/22 at 12:51 PM PST]
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