Box 11 of my W-2 is filled in because I receive mandatory withdrawals from my deferred salary plan. The two option for this question in the W-2 interview are:
Yes, I took this money out of my nonqualified or Section 457 plan.
or,
No, this is money I contributed to my nonqualified or Section 457 plan.
I don't know how to answer because I did both... this is money that I contributed to the plan and now I'm taking it out.... ???
If there is an amount in box 1 is for a distribution in 2020, then yes. If you made a deferral to the plan in 2020, then no. If there are no amounts in box 3 or 5, then it would be considered a distribution
I am confused because I neither contributed nor took out the amount referenced in box 1. This amount represents C (taxable amount of group life insurance). Last year's return asked me if was either and at the bottom it had yes or no and I have always chosen no. My company pays this on my behalf. But this year (2021) it has Yes I took this money out of my nonqualified or Section 457 plan or No this is money I contributed. I am totally as to what to do. I just assumed this was imputed income since I didn't actually contribute anything to the payment of the insturance.
It's asking if you took the money out because if you took it out you have to pay taxes on it. Since you did then you will need to answer yes to the 457 question.
Here's a fabulous bit on the difference between qualified and non-qualified plans.
This happens to be my exact situation. Check the box "Yes", because you do owe taxes on the "imputed" value of the life insurance the company has paid for on your behalf.
I, too, am confused. If I received a W-2 that had box 1 and box 11 filled in, do I answer "Yes" or "No"? I'm confused because I didn't "take this money out...", nor did I "contribute" to it. It was a distribution from a pension plan.