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10173: 1040 - Line 1 Exceeds W2 Income


1040 Individual Generally

Line 1 on the 1040 (Line 7 in Drake17 and prior) is showing more income than I can account for on the W-2s.

 

The additional amount may be the result of additional compensation. Examples of compensation that may be reported on line 1 include:

  • Disability Pensions - if the taxpayer has not reached the minimum retirement age set by the employer, this amount may report on line 1. Go to the 1099 screen and view the information under Additional Information for this Distribution. Is there a check in the box marked 1099-R for disability and one in the box marked If so, reported as wages on the 1040? Unselect the second box and the income will report on the Pensions and Annuities line of the 1040.
  • Employer-Provided Dependent Care Benefits - some or all of these benefits may be excludable. These benefits are reported on the W-2 in box 10; any taxable portion will be reported on line 1 with the literal DCB. Review the 2441 page 2, Part III in view mode for more information regarding the taxable portion.
  • Employer-Provided Adoption Expenses - some or all of these benefits may be excludable. These benefits are reported on the W-2 in box 12; any taxable portion will be reported on line 1 with the literal AB. Review the 8839 in view mode for more information regarding the taxable portion.
  • Scholarships & Fellowships - some or all of these benefits may be excludable. Any taxable portion will be reported on line 1 with the literal SCH.  If the amount was not reported on a W-2, look at Screen line 1 (line 7 in Drake17 and prior) to see if there is an amount keyed in the field marked Taxable scholarships not reported on W-2.
  • Excess Deferred Compensation - amounts in excess of the limit for the retirement plan may be reported on line 1.  Generally, these amounts are reported in box 12 of the W-2.
  • Employer-Provided Expenses - reimbursements for expenses not included in box 1 of the W-2 will be reported on line 1 as income.  Go to the 2106 screen and check for entries in boxes 7a and 7b under the heading Reimbursements NOT included in Box 1 of Form W-2.
  • Foreign Employers Compensation (FEC) - amounts from the FEC screen display on the first line of line 1 with the literal FEC. See “Foreign Employee Compensation (FEC)” in Related Links at the bottom of this page.

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