What does W-2 Box 12 Code CC represent?

W-2 Box 12 Code CC specifically refers to "HIRE exempt wages and tips." This code is utilized by employers to report wages and tips that are exempt from the Federal Insurance Contributions Act (FICA) taxes under the Hiring Incentives to Restore Employment (HIRE) Act provisions. The HIRE Act was designed to encourage businesses to hire more workers during economic downturns by providing tax incentives related to the employment of qualified individuals.

When reviewing the other codes mentioned, they relate to different payroll reporting aspects. The cost of employer-sponsored health coverage pertains to an entirely different area, focusing on health benefits. Designated Roth contributions relate to retirement savings and are reported to track contributions made to Roth 401(k) accounts. The Individual Taxpayer Identification Number addresses tax identification needs for individuals who are not eligible for a Social Security number but still need to file tax returns.

Understanding the specific application and purpose of each W-2 Box 12 Code is crucial for accurate tax reporting and compliance.