Is Your Gross Wages For The Social Security Earnings Test The Amount Shown In Box 1 Of Your W-2 Form?

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Feb 23 2019 - 3:15pm

Larry, I'm trying to clarify the employment income to use for the SS earnings test and whether you can use Box 1 on your w-2 (which many times is reduced by 401(k) contributions). I read an article recently that stated Box 1 was the income you could use so wanted to see what your opinion was. Many articles I read online don't address this issue at all but I would think many people that want to keep working part-time and also make 401k contributions would want to know as it could change significantly how many hours they could work without limiting their SS payments. The official Social Security literature is vague and doesn't discuss what # on your form w-2 should be used. It does say its counts an employees retirement contribution but only if its included in the employees gross wages, which could be interpreted to mean included in the total amount in Box 1 of your w-2? Any help would be appreciated. thanks, Keith

Hi Keith,

No, you can't rely on box 1 of your W-2 form to accurately reflect your countable earnings for Social Security earnings test purposes. The countable amount of wages for earnings test purposes includes a person's gross wages and tips before any deductions for items such as 401k contributions (https://www.ssa.gov/OP_Home/handbook/handbook.18/handbook-1811.html).

I don't know if any box on a W-2 form would correctly reflect a person's countable wages for earnings test purposes in every case, simply because there are so many variables involved in what's listed in the various boxes. I would guess, though, that for the majority of people the most reliable box to go by would be the amount shown in box 5 (i.e. Medicare wages and tips).

Best, Jerry