Box 12 Code W for Cafeteria Plan Vision Insurance?

Forum|Forum|7 years ago
June 1, 2019
8 replies
33 views

My husband has vision insurance which is taken out of his paycheck pretax through a cafeteria plan. His work has coded the amount with code W in box 12. Is this correct? Turbo tax then wants him to give info on a HSA account but he doesn't have one. His employer says it is correct because it is done through a cafeteria plan and code W includes cafeteria plans.

TurboTax Deluxe Online

Best answer by ghost

His employer is mistaken. Code W in box 12 is reserved for HSA contributions.

https://ttlc.intuit.com/replies/4557768

absolutejunk8Author

Level 2

His employer refuses to change the W2 because they say the code is correct. The employer would not give us the contact info of whoever does their payroll either (they outsource it). I am unable to finish doing our taxes on turbotax because it wants me to fill out the HSA form, including the total balance in the HSA account at the end of the year, etc. which obviously we don't have since we never had a HSA. What would be our best option in this case? Again, the funds were for vision insurance and were taken out of his paycheck pretax. And, according to his employer they were paid through a cafeteria plan. What would be the proper way to report that on a W2? Is it just reflected in wages? I'm just not sure what to do at this point. I don't want to leave it off and get flagged, but I also can't just leave it in since we can't truthfully fill out the HSA form either (since we didn't have one).

ghost

Level 8

Thanks for the reply.
I can tell you that's it's not only Turbotax but any other program or tax professional will insist that code W means HSA and the associated form(s) must be completed.
You are not the first person posting here that has had an employer make a similar error with code W. It seems like the IRS instructions for this are just vague enough to cause problems.
I will ask @dmertz and @TaxGuyBill to reply here. They are both well informed in this area and may be able to offer more.
It may take a bit for one or both to respond. Please be patient.
BTW We are not TT employees. Just dedicated contributors who want to help if we can.

TaxGuyBill

Level 13

I agree with rebab. Code W is only for HSAs (including HSA contributions through a Cafeteria plan). But only for HSAs.

I would bring a copy of the instructions for a W-2 to the employer and see what they say about the instructions for Code W.
<a rel="nofollow" target="_blank" href="https://www.irs.gov/instructions/iw2w3/ch01.html#d0e2461">https://www.irs.gov/instructions/iw2w3/ch01.html#d0e2461</a>
<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/iw2w3.pdf#page=29">https://www.irs.gov/pub/irs-pdf/iw2w3.pdf#page=29</a>

dmertz

Level 15

Code W is explicitly for contributions to an HSA. From the instructions for Form W-2 (one of TaxGuyBill's references):

Code W—Employer contributions to a health savings account (HSA). Show any employer contributions (including amounts the employee elected to contribute using a section 125 (cafeteria) plan) to an HSA. See Health savings account (HSA).

The confusion may stem from the mention of a cafeteria plan in this instruction, but it's specifically referring to contributions to an *HSA* under a cafeteria plan. It certainly does not refer to amounts the employer or the employee paid for insurance.