Form W-2, known as a wage and tax statement, is an Internal Revenue Service (IRS) form that employers use to report employees' wages and taxes withheld. The form must be filed for each employee along with Form W-3 on or before January 31 each year.
The W-2 Form is also used to report FICA taxes to the Social Security Administration. If you're wondering what to do with a W-2 Form, read through our guide and answers to frequently asked questions below.
Who must fill out IRS Form W2
According to the IRS, all employers (regardless of trade or business) that pay wages to one or more employees, including non-cash payments of $600.00 or more per year, must file a Form W-2 for each employee. By law, all amounts must be reported if any income, Social Security, or Medicare tax was withheld for services performed, even if the employee is related to the employer.
When to Fill out a W 2 Form:
- You withheld any income, Social Security, or Medicare tax from wages regardless of wage amount.
- You would have had to withhold income if the employee had claimed no more than one withholding or had not claimed exemption from withholding on Form W-4.
- You paid $600.00 or more in wages even if you did not withhold any income, Social Security, or Medicare tax.
Important to Note:
- Anyone required to file Form W-2 must file Form W-3 to transmit Copy A of Forms W-2.
- Make a copy of Form W-3, keep it and Copy D (For Employer) of Forms W-2 with your records for 4 years.
What is a W-2 tax form?
Form W-2 is a tax form from the IRS that employers use to report employees' wages and taxes withheld, and to report FICA taxes to the Social Security Administration. It is also known as a wage and tax statement.
Where can I get W-2 forms?
To order official IRS Forms W-2 and W-3, which include a scannable Copy A for filing, visit the IRS Online Ordering for Information Returns and Employer Returns webpage. Click on Employer and Information Returns. The IRS will mail you the scannable forms.
What does Box 12 Code D mean on Form W-2?
The Box 12 code pertains to information about your income and the category that it falls under. The IRS has a comprehensive guide to the Box 12 codes.
How is Form W-2 calculated?
Form W-2 is calculated based on your specific earnings and unique circumstances. The IRS provides a calculator tool that will help you to determine your tax contribution based on your unique information.
Is a W2 the same as a 1040a?
No. Form W-2 is used by employers to report on their employees wages and tax contributions while Form 1040 is a personal tax return form. Form W-2 does not replace a Form 1040.
How do I file Form W-2?
You can either mail or electronically file Forms W-2 and W-3 on the SSA's Employer website.
What are the penalties for filing Form W-2 late?
If you fail to file a correct W-2 Form by the due date, you may receive a penalty.
The penalty applies if you:
- Fail to file timely.
- Fail to include all information required to be shown on Form W-2.
- Include incorrect information on Form W-2.
- File on paper forms when you are required to e-file.
- Report an incorrect TIN.
- Fail to report a TIN.
- Fail to file paper Forms W-2 that are machine-readable.
The penalty amount is based on when you file Form W-2 correctly. Penalties range from $50.00 to $270.00 per Form W-2, depending on the number of forms you have submitted late and the date on which you submitted them.
Can I ask for an extension to file IRS Form W-2?
Employers may request an extension of 30 days to file Form W-2 by submitting a complete application on Form 8809 "Application for Extension of Time To File Information Returns." Bear in mind that the IRS will only grant an extension in extraordinary circumstances. Refer to the SSA website for more information.