What Are the W-2 Reporting Requirements for 457(b) Private Tax-Exempt Plans?

Q: In an Ask the Experts column from a few years ago, you outlined the Form W-2 reporting requirements for 457(b) distributions from private tax-exempt plans. Has anything changed since the publication of that column?

Kimberly Boberg, Kelly Geloneck, Emily Gerard and David Levine, with Groom Law Group, and Michael A. Webb, senior financial adviser at CAPTRUST, answer:

A: The requirements noted in that column remain the same: Distributions from a nongovernmental 457(b) plan must be reported in Box 1 (“Wages, tips or other compensation”) of Form W-2.

Although not noted previously—and maybe not as clearly required—distributions for 457(b) plans of private, tax-exempt organizations must also be reported in Box 11 (“Nonqualified plans”) of Form W-2, according to the 2024 Form W-2 Instructions for that box (page 20). The purpose of Box 11 is for the Social Security Administration to determine if any part of the amount reported in Box 1 was earned in a prior year. The SSA uses this information to verify that it has properly applied the Social Security earnings test and paid the correct amount of benefits.

NOTE: This feature is to provide general information only, does not constitute legal advice and cannot be used or substituted for legal or tax advice.

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