MA state filing pulling 1040 wages instead of box 16

[REY1000]

Hello

I live in MA.  My federal wages in box 1 of my w-2 are higher than my state wages (box 16) by $1500.  This is because I have in box 12a of my w-2,  $1500 taxable cost of group term life insurance (code C in box 12a).  When turbotax starts my MA tax forms, it does not allow me to use the box 16 state wages, it is automatically pulling over the higher box 1 federal wages (line 1z from my federal 1040).  I  understand this is typically the same number but in my case it is not.  Can someone let me know if 1. my interpretation is correct in assuming that line 3 in the MA tax form should be using box 16 from my W-2, not box 1... and if so 2. is there a way to override the pull over and input the correct number? thank you

[JamesG1 · Accepted solution]

If your employer provided more than $50,000 of group term life insurance coverage, the amount included in your income is reported as part of your wages in box 1 of Form W-2.  Therefore, it is included in adjusted gross income.  It is also shown separately in box 12 with code C.   See this IRS Publication here.

The TaxBook states:  Maine begins with Federal adjusted gross income (AGI).

Maine has no adjustments for the taxable cost of group term life insurance and I find no direct references to the taxable income on the Maine website.  I believe that it is taxed by Maine.

What is your understanding of the matter? 

[REY1000]

Hi James G

thanks so much for your response.  MA is Massachusetts not Maine but the New England tax laws are very similar, and your very thorough and sound thought process led me to read the MA tax law instead of just reading the tax form instructions as I had been doing.  Following your lead, I figured out that just as you said for Maine, Massachusetts also taxes the 12a (C) earnings and fed box 1 should match state box 16.  After reaching out to Payroll, they/I realized that in fact my W-2 is wrong and that is why the box 16 is lower than box 1...it actually should not be.

Once I get my W-2C I should be all set.  Thanks again as your thought process helped me find the root of the error. Big relief! Thanks a bunch!!