In tax reporting, what does Box 12 Code "Y" signify?

Box 12 Code "Y" signifies deferrals to 409A non-qualified deferred compensation plans. This code is used on the Form W-2, which reports an employee's annual wages and the taxes withheld from their pay. Non-qualified deferred compensation plans are arrangements that allow employees to defer a portion of their income to be paid at a later date. These plans do not have to meet the same requirements as qualified plans, which are subject to stricter IRS rules, hence they provide more flexibility but also come with different tax implications.

In contrast, other codes in Box 12 represent different types of deductions or contributions, such as moving expense reimbursements, medical savings account contributions, or elective deferrals to other types of retirement plans like Section 457(b). Understanding the specific codes and their implications is essential for accurate tax reporting and compliance.