16
Jan
Jan
What is the difference between gross pay and reported w-2 wages…there are 2 different numbers on my w-2…and on my w-2 the is less other cafe…what does that mean…on my w-2 less other cafe is the difference amount between my gross pay and reported w-2 wages
Answer:
The cafe charges are for benefits that are taken out pre-tax like health insurance and 401(k) contributions. Use the W-2 wages when filling out your tax return, not the gross wages.
Answer:
Gross pay is income before taxes. Reported W2 Wages are the wages that are subject to taxes and exclude non-taxable items like health insurance or a 401K plan. I'm not sure what "cafe" is, I've never seen that before.
Answer:
could be tips
Answer:
"Cafe" refers to benefits under a Section 125 plan, often referred to as a "Cafe Plan" because you can pick and choose the benefits that you need and reject those that you don't need, much like choosing what you'll eat in a cafe line at a restaurant. It includes amounts paid for health insurance with pre-tax dollars, amounts set aside in a Flexible Spending Account for unreimbursed health care costs or child care expenses, etc. Contributions to a qualified retirement plan are also pre-tax in most cases so they will also reduce your wages subject to income tax.
The amount in Box 1 reflects your wages net of the Cafe deductions and retirement plan contributions. The amounts in Boxes 3 and 5 reflect your gross wages subject to Social Security and Medicare taxes. SS and Med taxes are not reduced by Cafe Plan deductions or retirement plan contributions so the amounts in Boxes 3 and 5 reflect your true gross pay for the year.
Answer:
I have to agree with Bostionia…I can't describe it any better.
Answer:
Gross pay is before any deductions. If you have any pre-tax deductions, your reported w-2 wages would be smaller by the amount of those. CAFE usually means cafeteria plan, where you get to choose from a variety of benefits - that can be a pretax deduction.
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on Wednesday, January 16th, 2008 at 9:25 pm and is filed under Taxes.
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