What does W-2 Box 12 Code A indicate?

W-2 Box 12 Code A indicates "Uncollected Medicare tax on tips." This code is specifically used to report the amount of Medicare tax that has not been withheld from tips received by an employee. If an employee receives tips that exceed a certain threshold and if the employer has not withheld the appropriate amounts for Medicare tax, this uncollected amount must be reported using this code. This information is crucial for taxpayers in order to accurately report their income and tax liabilities, as it helps in determining the total tax due, including any additional taxes needed to be paid because of uncollected amounts.

Understanding each of the different codes on the W-2 is essential for filing accurate tax returns, as they convey specific information regarding compensation, tax withholdings, and various employee benefits.