What does W-2 Box 12 Code M pertain to?

The correct choice is related to uncollected social security tax on group-term life insurance. When an employer provides an employee with group-term life insurance in excess of $50,000, the value of that insurance becomes a taxable benefit. If the employer does not withhold the necessary social security taxes on this value, it must be reported in Box 12 of the W-2 using Code M. This helps ensure that employees are aware of the amount that should be considered for tax purposes and can take proper action when filing their taxes.

This information is crucial for accurate tax reporting, as failing to account for uncollected taxes could lead to an unexpected tax liability for the employee. Understanding the implications of various W-2 codes, such as Code M, can significantly impact an individual's tax return preparation and overall financial planning.