Eric, your friend, received his Form W-2 from his employer (below) and has asked for your help. Eric’s 2020 salary was $146,000 and he does not understand why the amounts in Boxes 1, 3, and 5 are not $146,000? His final paycheck for the year included the following information:
– Eric contributed 5 percent of his salary to the company 401(k) plan on a pre-tax basis.
– Eric is married with two children. He had $5,000 deducted from his wages for a Dependent
Care Flexible Spending Account.
– Eric is enrolled in the company-sponsored life insurance program. He has a policy that provides a benefit of $146,000.
– Eric contributed the 2020 maximum amount to the Health Care Flexible Spending Account.
Using the information and Eric’s Form W-2, prepare an email to Eric reconciling his salary of $146,000 to the amounts in Boxes 1, 3, and 5.

Transcribed Image Text:

b Employer Identification number (EIN) 12-3456789 e Employer's name, address, and ZIP code Ivy Technologies, Inc. 436 E. 35 Avenue Gary, IN 46409 d Control number Employee's social security number 791-51-4335 e Employee's first name and initial Last name Eric Hayes 555 E. 81st Street Merrillville, IN 46410 1 Employee's address and ZIP code 15 State Employer's state ID number IN 00122231001 Safe, accurate, OMB No. 1545-0008 FAST! Use Form W-2 Wage and Tax Statement Copy B-To Be Filed With Employee's FEDERAL Tax Return. This information is being fumished to the Internal Revenue Service. 3 Sodal security wages 137,700.00 Wages, tips, other compensation 131,080.00 5 Medicare wages and tips 138,380.00 7 Sodal security tips Suff. 11 Nonqualined plans 13 employe 14 Other 16 State wages, tips, etc. 17 State Income tax 131,080.00 4,900.00 2020 RS Telew efile www.rs.gov/late d ka 2 Federal Income tax withhold 15,190.00 4 Social security tax withheld 8,537.40 6 Medicare tax withhold 2,006.51 Visit the RS website at e Allocated tips 10 Dependent care benefits 5,000.00 12a See Instructions for box 12 DD 11,567.00 130.00 7,300.00 12b 1 120 12d C DI 18 Local wages, tips, etc. 19 Local Income tax 131,080.00 927.00 20 Localy nam LAKE Department of the Treasury-Irtomal Revenue Service