Code BB in Box 12 of your W-2 reports the Roth (after-tax) contributions you made to a 403(b) retirement plan through payroll deductions during the year. Your employer withheld the money after taxes and sent it to the Roth side of your 403(b) account. Because those dollars have already been taxed, the amount is baked into your Box 1 wages and there is nothing to add or subtract on your return.1Internal Revenue Service. General Instructions for Forms W-2 and W-3 – Box 12 Codes
What Code BB Reports
A 403(b) is a tax-advantaged retirement plan offered by public schools, 501(c)(3) nonprofits, and certain ministers. If your employer sponsors one and you chose the Roth option, Code BB is where your Roth deferrals show up.2Internal Revenue Service. Retirement Plans FAQs Regarding 403(b) Tax-Sheltered Annuity Plans
The code exists to separate Roth money from pre-tax money in the same kind of plan. Traditional 403(b) deferrals appear under Code E and lower your taxable wages now, with tax due when you withdraw in retirement. Roth deferrals under Code BB do the opposite: you pay tax on the contribution today, and qualified withdrawals later come out tax-free.
One boundary worth noting. If your W-2 shows Code AA instead of BB, you don’t have a 403(b) at all. AA reports Roth contributions to a 401(k). The tax mechanics look almost the same, but the plan type and the eligible employers are different.1Internal Revenue Service. General Instructions for Forms W-2 and W-3 – Box 12 Codes
How Code BB Affects This Year’s Taxes
The dollar figure next to Code BB is already included in Box 1 of your W-2, which is the taxable wages line. You’ve already paid federal income tax on it through withholding. Social Security and Medicare tax came out of it too. So Code BB does not reduce your current-year tax bill, and it does not add anything to it either.
This is the part that surprises people who compare pay stubs with coworkers. Someone contributing the same amount to a traditional 403(b) will see a smaller Box 1 number and owe less this year. You won’t. The benefit is on the back end, when qualified withdrawals, including all the investment growth, come out tax-free.
How the Amount Fits the Contribution Limit
The IRS caps how much you can defer into a 403(b) each year, and the cap covers your Roth and traditional deferrals combined. For 2026 the basic elective deferral limit is $24,500. If your plan lets you split contributions between Code E and Code BB buckets, the total across both cannot exceed that number. The same ceiling covers deferrals to a 401(k) at a second job.3Internal Revenue Service. Retirement Topics 403(b) Contribution Limits
Older workers have more room. If you were 50 or older during the year, you can add up to $8,000 in catch-up contributions for 2026, for a potential total of $32,500. Under SECURE 2.0, workers ages 60 through 63 get a higher catch-up limit of $11,250, bringing their potential total to $35,750.
Add the Code BB amount to any Code E amount on the same W-2 (and any elective deferrals reported on a W-2 from another employer) and compare the total against the limit that applies to your age. If the total is over, you have an excess deferral. Excess deferrals must be corrected before the April 15 tax deadline; otherwise the same dollars end up taxed twice, once now and again when withdrawn.
How to Report It on Your Return
There is almost nothing to do. Enter your W-2 exactly as printed. Tax software reads Code BB as a Roth contribution and knows the amount is already in Box 1, so it won’t tax the money a second time. No separate form is required for the contribution itself. Your adjusted gross income doesn’t change because of it.
Behind the scenes, the IRS uses the Code BB figure to check that your deferrals stayed within the annual limit. That’s the practical reason the code exists as a separate line item at all.
Hold on to every W-2 that shows a Code BB entry. Those amounts build your cost basis in the Roth 403(b), and you may need to prove that basis years or decades later if you ever take a non-qualified distribution. Without the paperwork, you could end up paying tax on money you already paid tax on.
If the Code BB Amount Looks Wrong
Compare the Box 12 figure against your final pay stub for the year. If it doesn’t match, or if your Roth contributions were mistakenly reported under Code E, ask your employer’s payroll department for a corrected W-2 (Form W-2c). Most errors get fixed at that stage.4Internal Revenue Service. Common Errors on Form W-2 Codes for Retirement Plans
If the end of February passes and your employer hasn’t responded or hasn’t fixed the problem, call the IRS at 800-829-1040 or visit a Taxpayer Assistance Center. Have your employer’s name and full address ready along with your Social Security number. The IRS will send the employer a letter directing a corrected W-2 within ten days.
If a corrected form still hasn’t arrived when you need to file, use Form 4852 as a substitute W-2. You fill in the figures from your own records and describe the steps you took to try to get the mistake corrected. Filing this way can slow processing, but it beats filing with numbers you know are wrong.
The Saver’s Credit
The Retirement Savings Contributions Credit, better known as the Saver’s Credit, can turn your Roth 403(b) contributions into a direct tax credit. It’s worth 10%, 20%, or 50% of up to $2,000 in contributions ($4,000 for married filing jointly), depending on your adjusted gross income and filing status. For 2026 the credit phases out entirely at $80,500 for married filing jointly, $60,375 for heads of household, and $40,250 for single filers.
You claim the credit on Form 8880, and the Code BB figure from your W-2 is the number you enter for your contributions. The credit is nonrefundable, so it can reduce your tax to zero but won’t generate a refund on its own. If your income sits inside the phase-out ranges, it’s worth running the numbers before you file.