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Employee is required to contribute 5% of monthly income to the contributory plan.
In order to max out $18k annual contribution limit for 401(k)s and 403(b)s, employee chose to also join supplemental plan and contributes $600 per month.

On employee's W2 $7,200 appears in box 12a with code E (this would be the $600 monthly supplemental plan payment x 12 months)

Is the W2 correct if it doesn't show the 5% contributory contribution on line 12, but does appear to reduce taxable income in box 1. Wages, tips, other comp based on that 5% contribution?

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rated:

rated:
Thanks, but not sure if that really clears it up.

Are the 5% required 403(b) contributions not appearing in box 12(e) because they are not "elective" deferrals?

• E - Elective deferrals under a section 403(b) salary reduction agreement

Is there another code in box 12 they should be appearing under?

rated:
icecube said:   Employee is required to contribute 5% of monthly income to the contributory plan.
In order to max out $18k annual contribution limit for 401(k)s and 403(b)s, employee chose to also join supplemental plan and contributes $600 per month.

On employee's W2 $7,200 appears in box 12a with code E (this would be the $600 monthly supplemental plan payment x 12 months)

Is the W2 correct if it doesn't show the 5% contributory contribution on line 12, but does appear to reduce taxable income in box 1. Wages, tips, other comp based on that 5% contribution?
 

  Yes, it is correct.
What you really have is a 401(a) plan (the 5% required/mandatory contribution part). I believe you get an employer match on that.
IRS link to 401(a)
Investopedia link

What is nice about this is that this 5% contribution does not count towards the 18k limit for an elective contribution to a 403(b). IOW, you can contribute the full 18k to that supplemental plan on top of the required 5% contribution to the 401(a) plan.

rated:
fwuser12 said:   
icecube said:   Employee is required to contribute 5% of monthly income to the contributory plan.
In order to max out $18k annual contribution limit for 401(k)s and 403(b)s, employee chose to also join supplemental plan and contributes $600 per month.

On employee's W2 $7,200 appears in box 12a with code E (this would be the $600 monthly supplemental plan payment x 12 months)

Is the W2 correct if it doesn't show the 5% contributory contribution on line 12, but does appear to reduce taxable income in box 1. Wages, tips, other comp based on that 5% contribution?

  Yes, it is correct.
What you really have is a 401(a) plan (the 5% required/mandatory contribution part). I believe you get an employer match on that.
IRS link to 401(a) 
Investopedia link 

What is nice about this is that this 5% contribution does not count towards the 18k limit for an elective contribution to a 403(b). IOW, you can contribute the full 18k to that supplemental plan on top of the required 5% contribution to the 401(a) plan.

 Hmmm...based on that IRS link I'm not sure if it's a 401(a).  The employee works for a non-profit (University) which doesn't appear in that IRS list?  You are correct the employer is contributing another 8% on behalf of the employee.  So maybe it's a 401(a) after all?  If so it's great to know the 5% doesn't count towards $18k...will have the employee greatly increase the supplemental contribution.  https://thefinancebuff.com/retirement-plans-galore-401a-401k-403...

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icecube said:    Hmmm...based on that IRS link I'm not sure if it's a 401(a).  The employee works for a non-profit (University) which doesn't appear in that IRS list?
 

  "a state or political subdivision, or its agency or instrumentality;"
Is it a state University? They are usually considered a state agency.

rated:
fwuser12 said:   icecube said:    Hmmm...based on that IRS link I'm not sure if it's a 401(a).  The employee works for a non-profit (University) which doesn't appear in that IRS list?
 

  "a state or political subdivision, or its agency or instrumentality;"
Is it a state University? They are usually considered a state agency.


It's a private university...

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Not sure if there is any such provision for non-profits; the IRS URL I linked is very brief.

Best thing is ti check with someone knowledgeable at their HR/payroll office. Both as to the nature of the plan and more importantly, what is the maximum contribution to the supplemental plan.

rated:
I work at a non-profit too and also max out 403(b) contributions. Employer contributes x% salary to a 401(a) retirement plan. The amount employer contributes actually does not appear on my W2 but gets mentioned in checked box 13 (retirement plan). Otherwise, my contributions appear on W2 in box 12, code E: $18,000.

So I'd assume that on W2, the company match would never appear anywhere but the checked box 13, then all of the employee pre-tax contributions to a 403(b) (voluntary and mandatory) would be added as box 12, code E. That should also match the difference between federal wages and social security wages (box 1 vs. box 3).

P.S.: I don't work at payroll so my info is only anecdotic

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