TN 13 (07-90)

A. Procedure

1. Form W-2

If there is a variance between the amount shown in box 1, “Wages, tips, other compensation,” and the amount shown in box 3, “Social Security wages,” plus the amount shown in box 7, “Social Security tips,” use the total of the amounts in boxes 3 and 7 for coverage and computation. For annual earnings test purposes, box 1 should be used if higher. For a current version of Form W-2, visit IRS’ website at http://www.irs.gov.

2. Form W-2c

If there is a variance between the amount shown in column (b) for line 1 (“Wages, tips, other comp.”) and total of the amounts shown in column (b) for lines 3 (“Social Security wages”) and 7 (“Social Security tips”), use the total of the amounts in column (b) for lines 3 and 7 for coverage and computation. For annual earnings test purposes, box 1 may be used if higher. For a current version of Form W-2c, visit IRS’ website at http://www.irs.gov.

3. Simplified Employee Pension Plan (SEP)

1. Prior to 1984, employer payments into a SEP plan were excluded from wages for FICA taxing purposes but not for Social Security coverage purposes.

2. When such a case is identified, include the amount of the employer's contribution to the SEP payment in Social Security wages for both computation and deduction purposes to the extent permitted under the statute of limitation.

3. Do not send a copy of Form SSA-7010-U5 to IRS if a correction is to be made to the E/R to include the SEP payment.

4. For 1984 on, see RS 01402.140.

B. Reference

RS 02201.001, Statute of Limitation