### Question
How does the law define compensation?


### Answer
Under *26 CFR § 1.61-2T*, **compensation** is defined as:

> the amount reported on a Form W-2 as income for the prior calendar year

#### Citation:
  - *26 CFR § 1.61-2T*
  - Heading: **CHAPTER I—INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY(CONTINUED)**

