Retirement tax questions

It's not a change in the TurboTax programming; rather, it's a situation in which amounts reflected in Box 11 of your Form W-2 can have a different characterization from one year to the next.

 

According to Box 11 in the Instructions for Employee on the back of Form W-2

 

This amount is (a) reported in box 1 if it is a distribution made to you from a nonqualified deferred compensation or nongovernmental section 457(b) plan, or (b) included in box 3 and/or box 5 if it is a prior year deferral under a nonqualified or section 457(b) plan that became taxable for social security and Medicare taxes this year because there is no longer a substantial risk of forfeiture of your right to the deferred amount. 

 

So, if a Box 11 amount was reported in Box 1 of Form W-2 one year, an amount can be included in Box 3 and/or 5 the next, characterized differently because "there is no longer a substantial risk of forfeiture of your right to the deferred amount."

 

Please see Box 11 -- Nonqualified plans in the General Instructions for Forms W-2 and W-3 for more information.

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