What does W-2 Box 12 Code C refer to?

W-2 Box 12 Code C specifically refers to the cost of group-term life insurance coverage that exceeds $50,000. The IRS requires employers to report this excess amount to ensure that employees are aware of any taxable fringe benefits they may have received. Group-term life insurance is generally provided by employers and, while coverage up to $50,000 is usually not taxable, amounts exceeding this limit must be reported as taxable income to the employee. This code helps both employers and employees keep track of taxable income accurately for tax filing purposes.

The other options relate to different types of benefits or compensation that employees may receive, but they are reported under other specific codes on the W-2 form. For instance, 401(k) contributions are reported under a different code, while health savings account contributions and tuition reimbursements have their own distinct reporting requirements.