chapter 9

  

Eric, your friend, received his Form W-2 from his employer (below) and has asked for your help. Eric’s 2019 salary was $145,200 and he does not understand why the amounts in Boxes 1, 3 and 5 are not $145,200? His final paycheck for the year included the following information:

–Eric contributed 5 percent of his salary to the company 401(k) plan on a pre-tax basis.
–Eric is married with two children. He had $5,000 deducted from his wages for a Dependent Care Flexible Spending Account.
–Eric is enrolled in the company-sponsored life insurance program. He has a policy that provides a benefit of $145,200.
–Eric contributed $2,650 to the Health Care Flexible Spending Account (he keeps forgetting that the maximum deferral has increased over the years).

Using the information and Eric’s Form W-2, prepare an email to Eric reconciling his salary of $145,200 to the amounts in Boxes 1, 3, and 5.

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