What Are the New Changes to the Form W-2 in 2026?

The SSA finalized a redesigned Form W-2 for tax year 2026 to reflect new reporting requirements introduced by the One Big Beautiful Bill Act (OBBBA). These changes do not apply to the 2025 Form W-2 that most employers just filed — they take effect for wages paid during 2026. Key updates include: Three new W-2 Box 12 codes: Code TA — Employer contributions to an employee's or dependent's Trump account under a section 128 contribution program Code TP — Total amount of cash tips reported to the employer that may qualify for the new tip deduction Code TT — Total amount of qualified overtime compensation eligible for the new overtime deduction New Box 14b field: Box 14 is now split into 14a (Other) and the new 14b — Treasury Tipped Occupation Code(s), which reports up to two IRS-designated tipped-occupation codes for employees in tip-eligible roles. RO and RU record changes for electronic filers: In the SSA's EFW2 electronic filing specification, existing W-2 Box 12 codes J, K, L, and P are now mapped within the RO and RU records, alongside the three new codes (TA, TP, TT). Payroll and software filers should confirm their EFW2 file layout reflects this update before the 2026 filing season. Social Security wage base increase: The Social Security wage base for tax year 2026 rises to $184,500. Social Security tax rate: Employers and employees will each continue to withhold Social Security tax at 6.2 percent, up to a maximum of $11,439.00 per employee for 2026. Household employee coverage threshold: The 2026 Social Security and Medicare coverage threshold for household wages is $3,000. Employers and payroll providers should begin reviewing payroll systems and EFW2 file mappings now so that tip, overtime, Trump account, and updated wage base figures are captured correctly ahead of the 2026 filing season.

Form W2 box 12 Codes | Instructions for Box 12 on W2

By Charles Hardy | Last updated: Oct 09, 2026

Key Takeaways

Form W-2 Box 12 reports up to 30 possible codes (A through II) covering benefits, deferrals, and compensation not included
in Box 1.
Each W-2 Box 12 code is a single or double letter followed by a dollar amount; the Box 12 codes for W-2 skip the letters I, O, and U to avoid confusion with numbers.
The most commonly used Box 12 codes for W-2 filers are D (401(k) deferrals), DD (cost of employer-sponsored health coverage), and W (HSA contributions).
Employers can report up to four codes per Form W-2 (boxes 12a–12d); a second Form W-2 is required for additional codes.
Some codes affect taxable income, others are informational only — the W-2 Form Box 12 reference table below identifies both, and the full W-2 Form Box 12 layout is covered in the instructions section.

What Is Form W-2 Box 12?

Form W-2 Box 12 reports compensation and benefits that fall outside Box 1 wages — things like retirement contributions, employer-paid insurance, and certain deferred income. Because there are many types of benefits to report, the IRS assigns each one a W-2 Box 12 code so the specific type of compensation or deduction is clear to both the SSA and the employee.

What Box 12 captures: Retirement plan contributions, employer-sponsored benefits, non-taxable reimbursements, and certain deferred compensation
What it excludes: Anything already reflected in Box 1 (regular taxable wages)
How W-2 Form Box 12 works: Each entry pairs a code with a dollar amount — up to four codes per Form W-2 (boxes 12a–12d)
If more than four apply: The employer must issue a second Form W-2 to report the remaining codes

Understanding Form W-2 Box 12 Codes

Form W-2 Box 12 contains 30 different codes, ranging from "A" to "II," used to report specific compensation, taxes, contributions, and benefits. The table below lists every one of the Box 12 codes for W-2 along with its description.

W-2 Box 12 Code	Description
A	Uncollected Social Security or RRTA (Railroad Retirement Tax Act) tax on tips (not included in Box 4)
B	Uncollected Medicare tax on tips, excluding Additional Medicare Tax (not included in Box 6)
C	Taxable cost of group-term life insurance coverage over $50,000
D	Elective deferrals to a section 401(k) cash or deferred arrangement
E	Elective deferrals under a section 403(b) salary reduction agreement
F	Elective deferrals under a section 408(k)(6) salary reduction Simplified Employee Pension (SEP) plan
G	Elective deferrals and employer contributions (including non-elective deferrals) to a governmental or nongovernmental section 457(b) deferred compensation plan
H	Elective deferrals under a section 501(c)(18)(D) tax-exempt organization plan
J	Non-taxable sick pay
K	20% excise tax on excess golden parachute payments
L	Substantiated employee business expense reimbursements
M	Uncollected Social Security or RRTA tax on the taxable cost of group-term life insurance over $50,000 (for former employees)
N	Uncollected Medicare tax on the taxable cost of group-term life insurance over $50,000 (for former employees)
P	Excludable moving expense reimbursements paid directly to a member of the U.S. Armed Forces
Q	Nontaxable combat pay (military personnel only)
R	Employer contributions to an Archer MSA
S	Employee salary reduction contributions under a section 408(p) SIMPLE plan
T	Employer-provided adoption benefits
V	Income from the exercise of nonstatutory stock option(s); also included in Boxes 1, 3 (up to the Social Security wage base), and 5
W	Employer contributions to a health savings account (HSA)
Y	Deferrals under section 409A on a nonqualified deferred compensation plan
Z	Income under a nonqualified deferred compensation plan that fails to satisfy section 409A
AA	Designated Roth contributions under a section 401(k) plan
BB	Designated Roth contributions under a section 403(b) plan
DD	Cost of employer-sponsored health coverage
EE	Designated Roth contributions under a governmental section 457(b) plan
FF	Permitted benefits under a qualified small employer health reimbursement arrangement (QSEHRA). For 2026, the maximum reimbursement is $6,450 for self-only coverage and $13,100 for family coverage (up from $6,350 and $12,800 in 2025)
GG	Income from qualified equity grants under section 83(i)
HH	Aggregate deferrals under section 83(i) elections as of the close of the calendar year
II	Medicaid waiver payments excluded from gross income under Notice 2014-7

Form W-2 Box 12 Codes: Instructions

W-2 Form Box 12 has four lines—12a, 12b, 12c, and 12d—and each line holds one W-2 Box 12 code paired with its corresponding dollar amount.

Enter the applicable code exactly as listed (capital letters only)
Enter the dollar amount associated with that W-2 Box 12 code
List codes in any order across 12a–12d on W-2 Form Box 12
If more than four Box 12 codes for W-2 apply to a single employee, issue a second Form W-2 for the additional codes
Double-check that codes affecting taxable wages (such as Code V or Code Z) are also reflected correctly in Boxes 1, 3, and 5 where required

If you need to report more than four codes in Box 12, you need an additional Form W-2.

What are the New Changes to the Form W-2

The SSA finalized a redesigned Form W-2 for tax year 2026 to reflect new reporting requirements introduced by the One Big Beautiful Bill Act (OBBBA). These changes do not apply to the 2025 Form W-2 that most employers just filed — they take effect for wages paid during 2026. Key updates include:

Three new W-2 Box 12 codes:
- Code TA — Employer contributions to an employee's or dependent's Trump account under a section 128 contribution program
- Code TP — Total amount of cash tips reported to the employer that may qualify for the new tip deduction
- Code TT — Total amount of qualified overtime compensation eligible for the new overtime deduction

Learn more about the Form 1099 2026 changes

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