What is Form W-2?
Form W-2, Wage and Tax Statement, is filed by an employer for each employee from whom income, Social Security, or Medicare tax was withheld. It reports the annual wages of an employee and the amount of taxes withheld from his or her salary to the Internal Revenue Service (IRS).
When should employees receive their Form W-2?
If you are an employee, you should receive a copy of your Form W-2 by January 31. You do not have to fill out any Form W-2.
Form W-2 is useful for employees when they file their Form 1040, U.S. Individual Income Tax Return. Taxpayers do not have to fill out the form; however, if you are an employer, you need to provide all the required information on the form — and accurately.
If you are an employer, you have to mail the appropriate copies of Form W-2 to employees and the IRS by January 31 or face a late filing penalty, as you are legally required by law to send out the copies of the form. Also, you will use it to report Federal Insurance Contributions Act (FICA) taxes for your employees throughout the year. Furthermore, you must file it with the Social Security Administration (SSA) for each employee along with Form W-3, Transmittal of Wage and Tax Statements, by the end of January.
Who are the recipients of the copies of Form W-2?
Form W-2 consists of six copies that have the same fields. Here are the respective recipients of Form W-2:
- Copy A — The employer sends Copy A to the SSA, together with Form W-3 or Transmittal of Wage and Tax Statements.
- Copy B — The employer sends Copy B to the employee. The employee uses this copy to report federal income taxes.
- Copy C — The employer sends Copy C to the employee for his or her records.
- Copy D — The employer keeps Copy D for the company’s records.
- Copy 1 — The employer sends Copy 1 to the appropriate state, city, or local tax department, if applicable.
- Copy 2 — The employer sends Copy 2 to the employee to file with the appropriate state, city, or local tax department, if applicable.
How to fill out Form W-2?
For employers to fill out the form, they need information about their business, such as Social Security Number (SSN), Employer Identification Number (EIN), and business name and name, and information about an employee, such as SSN or other tax identification number, name, address, and wages and taxes-related information.
Follow the instructions below to answer the form accurately if you are an employer:
Enter the employee’s social security number. Double-check the accuracy of the employees’ SSNs to avoid delays in processing tax returns.
Enter your nine-digit employer identification number (EIN). The IRS will use this to identify your tax account.
Enter your name, address, and ZIP code.
Enter the internal control number you use in your payroll department. Leave the item blank if not applicable.
Enter the employee’s full legal name in the following format: first name and initial, last name, and suffix.
Enter the employee’s address and ZIP code.
Enter the employee’s total annual taxable wages, tips, and other forms of conversation, minus elective deferrals, such as 401(k) plans, pretax benefits, and payroll deductions.
Enter the federal income tax withheld from the employee’s pay.
Enter the employee’s total wages, excluding tips, subject to social security tax.
Enter the total amount of social security taxes withheld from the employee’s pay for the year.
Enter the employee’s Medicare wages and tips, including tips, subject to tax.
Enter the total amount of Medicare taxes withheld from the employee’s pay for the year.
Enter the employee’s total amount of reported tips subject to Social Security tax.
Enter any tip income you allocated to the employee.
This item is no longer used.
Enter the total benefits you provided to the employee under dependent care assistance.
Enter the total amount distributed to the employee from your nonqualified deferred compensation or a non-government pension plan.
Items 12a, 12b, 12c, and 12d
Enter the appropriate single or double-letter code to report several different types of compensation and benefits.
Mark the box that pertains to the employee. You can select “Statutory Employee,” “Retirement Plan,” and “Third-Party Sick Pay.”
- Statutory employee means that the employee’s earnings are subject to Social Security and Medicare taxes but not federal income tax withholding.
- Retirement plan means that the employee participated in your retirement plan during the year.
- Third-party sick pay means that the employee received sick pay under your third-party insurance policy.
Enter any information that does not have a specific box in Form W-2.
Enter your state and state tax identification number.
Enter the total taxable wages the employee earned in a specific state.
Enter the total amount of state income taxes withheld from the employee’s wages reported in Item 16.
Enter the total amount of the employee’s wages and tips subject to local, city, or other state income taxes.
Enter the total taxes withheld from the employee’s wages for local, city, or other state income taxes.
Enter the name or code of the local area where the employee’s wages are reported to.
Where to submit Form W-2?
You are required to file Form W-2 if you are filing more than 250 forms. You can e-file through SSA’s Business Services Online. There is no fee when you file Form W-2 online. Moreover, the SSA will help you generate Form W-3.
If you are filing paper forms, send the W-2 forms, together with Form W-3, to:
Social Security Administration
Direct Operations Center
Wilkes-Barre, PA 18769-0001