The codes in Box 14 of your W-2 are whatever label your employer chose for amounts that didn’t fit anywhere else on the form, and every entry you’ll see falls into one of three buckets: already handled in your Box 1 wages, potentially deductible on Schedule A, or purely informational for your records. The IRS gives employers wide latitude in this box, so the same deduction can appear under three different abbreviations at three different companies. Decoding your W-2 Box 14 codes is mostly a matter of matching the label to what kind of amount it represents, then knowing whether that type of amount does anything on your return.
Why the Labels Aren’t Standardized
Box 12 uses letter codes the IRS defines. Box 14 doesn’t. The IRS instructions tell employers they “may also use this box for any other information that you want to give to your employee” and simply ask them to “label each item.”1Internal Revenue Service. 2026 General Instructions for Forms W-2 and W-3 One employer labels California state disability insurance as “SDI,” another as “CASDI,” a third as “CA DISAB.” The dollar figure represents the same withholding; the abbreviation is whatever the payroll system produced. If a code on your W-2 doesn’t match anything in this article, your employer’s payroll department is the only authoritative source for what it means.
The Three Categories Every Box 14 Entry Falls Into
Before working through specific codes, it helps to know the question you’re actually trying to answer about each one. Every entry is either:
- Already excluded from the wages in Box 1, meaning no action on your federal return.
- An after-tax state or local withholding that may be deductible on Schedule A if you itemize.
- Taxable excess that should have been added to Box 1 but might not have been.
A fourth outcome covers union dues, company car values, and other informational items that sit in Box 14 for your records without transferring anywhere on your return. Figuring out which bucket a code belongs to is the whole exercise.
Pre-Tax Benefits Already Reflected in Box 1
Section 125 Cafeteria Plans and FSAs
Entries labeled “SEC 125,” “CAF125,” or “FSA” refer to your employer’s Section 125 cafeteria plan, which lets you pay for health insurance premiums, flexible spending accounts, or dependent care assistance with pre-tax dollars. The amount shown has already been subtracted from your Box 1 wages. You don’t do anything with it on your federal return.
A handful of states tax Section 125 contributions even though the federal government doesn’t. If you work in one of those states, the Box 14 figure tells you how much to add back to your state taxable income, and your state return instructions or tax software will walk you through that adjustment.
Educational Assistance
Employers can exclude up to $5,250 per year in educational assistance from your gross income.2Internal Revenue Service. Publication 970 (2025), Tax Benefits for Education Benefits at or below that threshold may appear in Box 14 (often as “EDUC” or “EDU ASST”) but won’t be included in your Box 1 wages. If your employer provided more than $5,250, the excess is taxable, and your employer should have already included it in Box 1. The Box 14 entry sometimes shows the full amount so you can see the breakdown. For example, if you received $7,000 in educational assistance, $5,250 is excluded and $1,750 should already be reflected in Box 1.3Internal Revenue Service. Employer-Offered Educational Assistance Programs Can Help Pay for College
Section 414(h) Pension Pickups
Public-sector employees often see “IRC414H” or “414H” in Box 14. Under this arrangement, your employer “picks up” what are technically your contributions to a government retirement plan. Those contributions are excluded from your gross income for federal tax purposes and have already reduced your Box 1 wages.4Internal Revenue Service. Employer Pick-Up Contributions to Benefit Plans They remain subject to Social Security and Medicare tax when they come from salary reduction, which is why they appear separately in Box 14 instead of disappearing from the W-2 entirely.
The 414(h) figure is informational for your federal return. It matters for state returns in states that tax these contributions even though the federal government doesn’t.
Commuter and Parking Benefits
Employer-provided transit passes and qualified parking are tax-free up to $340 per month for 2026.5Internal Revenue Service. Publication 15-B (2026), Employers Tax Guide to Fringe Benefits Within that limit, any Box 14 entry is informational. Above it, the excess is taxable and should be in Box 1. If you see a commuter benefit in Box 14 and suspect the excess wasn’t added to Box 1, check with payroll.
State and Local Withholdings That May Be Deductible
State Disability Insurance and Paid Family Leave
Several states require employees to pay into disability insurance or paid family leave programs through payroll. These show up as “SDI,” “CASDI,” “NYSDI,” “NJSDI,” “NYPFL,” “FLI,” or similar codes. They’re after-tax withholdings.
Mandatory state disability and paid family leave contributions generally count as state taxes you paid. If you itemize on Schedule A, include these amounts on Line 5a along with your state income tax withholding.6Internal Revenue Service. 2025 Schedule A (Form 1040) Voluntary plan disability insurance (VPDI), offered by some employers as an alternative to the state program, is generally treated the same way for deductibility.
All of this is subject to the federal SALT cap, set at $40,400 for 2026 ($20,200 for married filing separately). State and local taxes above the cap don’t help on your federal return.
Local Taxes and Employee-Paid Unemployment
City or county taxes sometimes appear in Box 14 rather than Box 19. Employers typically use Box 19 for local income taxes calculated as a percentage of earnings, and Box 14 for flat-rate occupational taxes, per-capita assessments, or other local levies that don’t fit the standard income-tax mold. The amount generally qualifies for the SALT deduction on Schedule A either way.
Employee contributions toward state unemployment insurance, sometimes labeled “SUI” or “SUT,” follow the same rule. They’re after-tax withholdings that may be deductible as state taxes paid if you itemize.
Fringe Benefits and Other Common Codes
Personal Use of a Company Vehicle
If your employer provides a vehicle you also use personally, the value of the personal use is a taxable fringe benefit. Employers calculate it using the vehicle’s annual lease value or another IRS-approved method, add the result to your Box 1 wages, and report the same figure in Box 14 (often as “AUTO”) so you can see the breakdown. It’s already in Box 1, so you don’t report it again elsewhere.
Union Dues
Union dues often appear as “DUES,” “UNION,” or the union’s abbreviation. Federal law eliminated the deduction for miscellaneous itemized deductions, which included union dues, starting in 2018. That elimination was made permanent in 2025 under IRC Section 67(h), so union dues are not deductible on your federal return. Some states still allow the deduction on the state return.
Clergy Housing Allowance
Ministers and clergy may see a housing or parsonage allowance in Box 14, often labeled “HOUSING” or “PARSONAGE.” This amount is excludable from gross income for federal income tax purposes and should not be included in Box 1. The excludable amount is the lesser of the amount officially designated as a housing allowance, the amount actually spent on housing, or the fair rental value of the home including furnishings and utilities.7Internal Revenue Service. Ministers Compensation and Housing Allowance Any excess that can’t be excluded must be added to wages on Line 1h of Form 1040.
Railroad Retirement Taxes
Railroad employees see a unique set of entries. Employers covered by the Railroad Retirement Tax Act report Tier 1 tax, Tier 2 tax, and Medicare tax amounts in Box 14. These replace the standard Social Security and Medicare withholdings that non-railroad employees see in Boxes 4 and 6, and they matter if you had multiple employers during the year and need to claim a credit for excess withholding.
Other Entries
Box 14 can also contain employer-paid health insurance premiums for non-major-medical plans, nontaxable income, uniform payments, and non-qualified deferred compensation contributions (sometimes labeled “NQDCP” or “NONQUAL”). Employer-paid health premiums reported here are typically informational. Non-qualified deferred compensation amounts are generally after-tax and serve as a record for tracking your basis.
Entering Box 14 Codes in Tax Software
Tax software asks you to type the description from your W-2, enter the dollar amount, and then pick a category from a dropdown. The dropdown uses standardized names that may not match your employer’s abbreviation exactly. “CASDI” on your W-2 maps to “State disability insurance” or “CA SDI” in the software. “IRC414H” maps to a Section 414(h) retirement contribution category.
If none of the categories match and you can’t determine what the entry represents, select “Other (not classified).” The software carries the amount through without applying any specific tax treatment, which is correct for purely informational items. Picking the wrong category is worse than picking “Other,” because it can wrongly add income or claim a deduction you aren’t entitled to. Check with your employer first; use “Other” as the fallback.
If a Code Is Unclear or Wrong
Your employer’s payroll department is the first stop for anything you can’t identify. They’re the only ones who can confirm whether “MISC DED” is a pre-tax benefit, an after-tax withholding, or something else. Ask specifically whether the amount was already excluded from Box 1 wages and whether it’s deductible anywhere on your return.
If a figure is genuinely wrong, your employer needs to issue a Form W-2c (Corrected Wage and Tax Statement) to fix it.8Internal Revenue Service. About Form W-2 C, Corrected Wage and Tax Statements Don’t file with a number you know is wrong. The IRS matches what you report against what your employer reported, and discrepancies can produce a CP2000 notice proposing additional tax, penalties, and interest.9Internal Revenue Service. Understanding Your CP2000 Series Notice
If your employer won’t cooperate or has gone out of business, you can file Form 4852 as a substitute for your W-2. The form requires you to estimate your wages and withholdings from pay stubs or other records and explain what you did to try to get the correct W-2.10Internal Revenue Service. About Form 4852, Substitute for Form W-2, Wage and Tax Statement It will slow processing, but it’s better than guessing or omitting income.