27 Jun I think my W2 is wrong. What can I do?

Q. I am an employee paid commission for my work. I’m paid a draw monthly, and then that draw amount is subtracted from my commission payments. So at the end of the year, all I have been paid is what I earned in commission. My Box 1 and Box 16 don’t match on my W2. The amount that I have actually been paid is correct in Box 1 of my W2, but the amount in Box 16 of my W2 shows what I was paid in commission plus my draw payments. It shows more money than my company actually paid me. Is this correct or incorrect?
— Worker

A. It sounds like something worth double-checking.

You need to reach out to your employer.

The W2 can be amended to reflect the correct amount of wages in Box 16, said Ann Marie Perry, a certified public accountant with Peapack Private Wealth Management in Summit.

She said New Jersey does not allow many common pre-tax deductions that the federal government allows, which is why there can be differences between Box 1, your federal wages, and Box 16, your state wages.

“Federal pre-tax deductions to a deferred compensation or retirement plan, other than 401(k) plans, are deducted from federal wages in Box 1, but are not deducted from state wages in Box 16,” she said. “In addition, pre-tax health insurance premiums, flex spending contributions, moving expenses and employee business expenses are also not deducted from state wages.”

If you have any of the aforementioned federal deductions, they can contribute to the difference you are seeing between the two boxes, she said.

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This story was originally published on June 27, 2023.

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