What do contributions reported under W-2 Box 12 Code E represent?

Contributions reported under W-2 Box 12 Code E specifically indicate contributions made to a 403(b) plan, which is a type of tax-sheltered annuity. This information is relevant because 403(b) plans are retirement savings plans designed for eligible employees of public schools, certain tax-exempt organizations, and some ministers. The contributions are typically made on a pre-tax basis, which means they are deducted from the employee’s gross income, reducing taxable income for the year.

Understanding the significance of this reporting is crucial for accurate tax filing, as it ensures that the contributions are properly accounted for in retirement plans, potentially impacting retirement savings strategies and tax liability.