Question

Which of the following describes a de minimis error where the safe harbor from penalties for filing an incorrect information return or an incorrect payee statement would apply?

Paul received his W-2 in a timely manner from his employer, The Corner Café. Box 1 of the W-2 (Wages, tips, other compensation) reported $200 more than Paul's actual wages as reported on his final paycheck for the year. Paul's W-2 was incorrect.
	Sheldon received his W-2 in a timely manner from his employer, Ice Box Cookie Company. Box 1 of the W-2 (Wages, tips, other compensation) were reported correctly, but his federal tax withholding was $20 more than his withholding as reported on his final paycheck for the year. Sheldon's W-2 was incorrect.
	Anne received her W-2 in a timely manner from her employer, Big Box Buys, Inc. Box 1 of the W-2 (Wages, tips, other compensation) were reported incorrectly as $32,500. Anne's wages for the year were correct on her final paycheck as $32,625.
	Aaron received his Form W-2 in a timely manner from his employer, Crawford Auto Sales Company. Box 1 of the Form W-2 (Wages, tips, other compensation) was reported correctly. His federal tax withholding on the W-2 was reported as $325. This was $100 more than his withholding reported on his final paycheck for the year. The withholding amount on Aaron's Form W-2 was incorrect.

Answer 1

correct option:

Sheldon received his W-2 in a timely manner from his employer, Ice Box Cookie Company. Box 1 of the W-2 (Wages, tips, other compensation) were reported correctly, but his federal tax withholding was $20 more than his withholding as reported on his final paycheck for the year. Sheldon's W-2 was incorrect.  

for safe harbor from de minimus rule to apply, reported wages should not be incorrect by no more than 100, and the tax withheld should not be incorrect by more than 25. hence remaining options are incorrect.