I took money out of my 457 plan and it is reported correctly on my W2c in Box 11. There is $0 in Box 1. Why won't the system recognize this as inc that should be taxed?

[dianarkes]

The income was reported in Box 11 as I am no longer an employee there. There are no wages in Box 1.

[DaveF1006]

Instead of entering the W2C as separate, just enter the information on the original W2 and just add the additional information recorded  in Box 11. After you you complete this task, there will be some follow-up screens that follow. One screen will ask if you took a distribution out of your non-qualified plan, you will say yes.

Now the big question is, did your employer already account for the withdrawal in Box 1 of the original W2 and included that in the wages? Check to see if this was the case and they just simply forgot to record this in Box11, thus the need for a w2C.

If this isn't the case, then this amount needs to be reported additionally in Box 1 thus a need for another W2C.

[rsethi]

I have somewhat similar situation.

I received regular Payroll W2 from my employer. I also received a 2nd "Pension W2" from my employer, which is to account for the non-qualified pension plan I am enrolled in. 

Based on what I understand from my employer, this 2nd W2 is to account for some mandatory taxes which need to paid out for (I think Social security and Medicare tax) when I earn $ in non-qual plan. I think it is something like - some amount of $ are withdrawn from non-qual plan to pay for these taxes and to account for all of this, a second W2 is given. Now, whether all of this can be in put in one W2 or not I am not sure.

 When I enter this second W2 in TurboTax and go through entire taxes, Turbotax is is giving STRONG ERROR since Box#1 in this 2nd W2 has much less $ compared to Box11. For relative comparison, Box1 has $1, for Box#11 has $50. So TT is not liking it.

Has anyone seen this in the past? Can I just ignore TT warning proceed and file my taxes?

One idea just came to me if - whether I combine $ from both the W2s and enter it just as 1 W2? But the issue might be that the EINs on both W2s are different even though I work for same company and both came from same company (guessing this might be more of different legal entities for same company type stuff).

Any thoughts or inputs are welcome! ---- Thank you. @DaveF1006  - what you suggest in my case?

[MarilynG1]

Yes, if your W-2's are from the same employer, you could combine the info into one entry in TurboTax to clear the error. 

The amount in Box 11 will be reported on Schedule 1, Line 8t as a income from a non-qualified deferred pension or 457 plan.

@rsethi 

[rsethi]

@MarilynG1 Thank you for quick inputs.

The concern I have is that the TWO W2 even from same employer/company, they have different EINs - so I am wondering if I can combine the amounts from these two W2s.

Most of large companies have multiple legal entities with multiple EINs and I guess that is my case.

Wouldn't IRS have record of two W2s and I am only submitting one? Will that cause any issues?

[MarilynG1]

Yes, the IRS will have a copy of both W-2's.  If they question your combined entry, it was done to report income distribution correctly in TurboTax for Box 11 (and be able to Efile).  People do combined W-2 entries for issues similar to yours often. 

If you only had one W-2 with a lesser amount in Box 1 than Box 11, then that's a problem for reporting properly in TurboTax. 

The IRS usually figures out what was done. 

@rsethi 

[rsethi]

@MarilynG1 Thank you very much for those insights. So I just add all boxes  from second w2 to their respective box in first W2 and then that will take care of it all. I will do so. Thanks again.

[dmertz]

Because the amount in box 11 indicates an amount that vested rather than an amount distributed, it will not appear on line 8t if entered correctly by indicating, when asked, that it was not a distribution.