What is the meaning of the abbreviation "gtl w2"?

The abbreviation "GTL" on a W-2 form stands for "Group Term Life" insurance, which is a type of life insurance coverage provided by an employer as a benefit to eligible employees.

The value of the GTL coverage provided by the employer is considered a taxable fringe benefit and must be reported on the employee's Form W-2.

The taxable amount of GTL coverage is calculated based on the IRS's Table I, which provides the cost per $1,000 of coverage for different age ranges.

Employees are typically allowed to exclude the cost of up to $50,000 of GTL coverage from their taxable income, but any coverage above that amount is considered a taxable benefit.

The taxable portion of GTL coverage is reported in Box 12 of the W-2 form with the code "C," and this amount must be added to the employee's federal and state wages in Boxes 1 and 16, respectively.

Employees who have more than $50,000 of GTL coverage may also owe additional Social Security and Medicare taxes on the taxable portion of the coverage, which are reported in Boxes 3 and 5 of the W-2.

If an employee contributes towards the cost of the GTL coverage, the amount they pay with after-tax dollars can be used to reduce the taxable portion reported on the W-2.

Employers are responsible for properly calculating and reporting the taxable GTL coverage on the employee's W-2, but it's important for employees to review their W-2 to ensure the information is accurate.

The taxable GTL coverage reported on the W-2 can have implications for an employee's eligibility for certain tax deductions or credits, so it's important to understand how it affects their overall tax situation.

In some cases, an employee may be able to exclude a portion of the GTL coverage from their taxable income if they have a spouse or dependents who are also covered under the policy.

Employees who have questions or concerns about the GTL reporting on their W-2 should consult with a tax professional to ensure they are properly handling the taxation of this fringe benefit.

The IRS provides detailed guidance on the taxation of GTL coverage, including the applicable exclusion rules and reporting requirements for employers, which can be found in Publication 15-B.