![]() ![]() Begin with the Gross Pay YTD (year-to-date) and make the following adjustments, if applicable:įederal Taxable Wage – Adjustments to Gross Pay YTD: Use your last pay stub for the year to calculate the taxable wages in boxes 1 and 16 in your W-2. ![]() ![]() The following steps will walk you through the calculations of the W-2 wage amounts and enable you to reconcile these to your final pay stub for the year.ĬALCULATING FEDERAL AND STATE TAXABLE WAGES (BOXES 1 & 16) The short answer is that the differences relate to what wage amounts are taxable in each case. The most common questions relate to why W-2 Wages differ from your final pay stub for the year, and why Federal and State Wages per your W-2 differ from Social Security and Medicare Wages per the W-2. Most of these questions focus on understanding the amounts in the numbered boxes on the W-2. Payroll receives many questions about the W-2. ![]()
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March 2023
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