Incorrect W-2

[elyoungnc]

I have been provided a 2024 W-2 that appears to be incorrect; there is a large credit amount in the Other Pretax/Wage Limit in the top section resulting in Box 1 being about 50% of my actual wages. In July 2024 I requested my employer to stop withholding Federal Taxes as I take the FEIE and did not want to over withhold and get a large refund. I had done the same thing in 2023 (same employer) and for that W-2 there is not amount in the Other Pretax/Wage Limit and the Box 1 is correct.

I had requested a corrected W-2 from the employer (I am not longer employed there); the payroll department logged a ticket with Dayforce (the payroll software) and Dayforce indicated that the W-2 is correct based on my withholdings.

Not sure how to proceed here; if I file my return using the number in Box 1 I will get a large refund; if I use the numbers on my final paystub (which obviously does not match the W-2) I will owe a substantial amount. I want to file correctly.

Thanks in advance.

[Vanessa A]

Do you know for sure which number is correct?  The first thing that needs to be done is verify the correct numbers.  Are they able to give you a break down of your pay, do you have all of your past pay stubs available?  Was there a possible error on a paystub?

If you can verify that YOU are correct and they are not, you would need to contact the IRS to see if they can get it straightened out. If they cannot, then you will need to file form 4582 to report the correct amount.  

The most important next step, before doing anything else with the IRS or filing your return, is to verify which numbers are accurate especially since there is such a large difference in your tax outcomes. 

[elyoungnc]

Since I posted my question I have gotten access to my pay statements for 2024 (my former employer was acquired by another company mid-2024 so this complicated the situation). I was able to determine, based on these pay statements, that the large discrepancy was due to a change made in the payroll system when I requested that withholding be stopped mid-year. For some unknown reason, the wages post stopping withholding were marked as not subject to federal income tax when in fact they WERE subject to federal income tax.

Based on my pay statements I was able to do the calculations (gross wages + group term life - pretax deductions) and tell the former employer what number SHOULD be in Box 1. After I told the former employer I had contacted the IRS (which I did but was a waste of time) and that the IRS would contact them and tell them they had 10 days to provide a corrected W-2 the former employer contacted the payroll software support line and I was provided a W2C the next day.

Thanks for responding!