Form W2, also called Wages and Tax Statement, is mandatory documentation every employer must do as required by the Social Security Administration and the IRS. The form is filed every year and contains information about individual employees of every employer.
The employer will need to fill and file separate Form W2 for every employee according to his pay stub and salary structure.
In today’s article, we will discuss when any company sends out W2 forms and what the procedure is to do so. Whether you’re an employee wondering about the deadlines and process of Form W2 or an employer looking for guidance for filing Form W2, the article is for you.
So let’s get into it.
- Form W2 is a mandatory requirement for every employer who pays remuneration to an employee in addition to $600 or more non-cash benefits.
- The deadline for completing and filing Form W2 is the 31st of January every year.
- Copies B, C, and two must be sent to the employee at his mailing address.
What is Form W2?
The IRS defines Form W2 as follows:
Every employer must file Form W-2 for his employee to whom he has paid remuneration for the year, including non-cash payments of $600 or more against the services taken from the employee. The employer must include all the amounts from which the income, social security, or medicare tax was held.
Who Files Form W2?
You must know who files the Form W2 after going through the definition of Form W2. Yes, the employer who has the employees working for him and taking monthly remuneration along with annual non-cash benefits of $600 or more is required to file the Form W2 for all his employees.
There is no exception for any employer to not file Form W2. All employers must file Form W2 for the payroll workers. However, they won’t need to file a Form W2 for non-payroll workers like freelancers, independent contractors, etc.
For the payments made to independent contractors or workers, the employer will complete and send relevant Form 1099 to the recipient of the money.
Why Is Form W2 Filed?
You must be wondering why employers have to file Form W2. If we talk about the general purpose of Form W2, it contains important information about an employee’s income, contributions, and taxes withheld.
Employers have to file Form W2 for their employees to report the tax withheld from all employees’ paychecks.
Form W2 contains information about the employee’s income, his contributions to the medical care programs, 401(k), etc., and the tax to be withheld according to the disclosures in Form W4.
The employers must file Form W2 with Social Security Administration and send copies to the employees. The copies for employees are necessary as Form W2 dictates what the employees have to add to their income tax return.
When Are W2 Forms Sent Out By Company?
There are two questions about filing Form W2.
When does an employer or a company files Form W2?
When will an employer or a company send out Form W2 to his employees?
So here are the answers to both questions.
The deadline for completing and filing Form W2 with the Social Security Administration is the 31st of January every year. Similarly, the employers have to send the relevant copies of the form to their employees via mail or electronically before the 31st of January. However, it can take some days to reach the Form W2 to the employees.
In case when the deadline for filing and sending Form W2 is a public holiday or weekend, the deadline is automatically updated to the first business day after the holiday. However, employers should try to file and send Form W2 before the deadline to avoid any delays or inconvenience.
What Is Information Needed For Filling Form W2?
You must be wondering what Form W2 exactly contains. So here is the description of information printed and filled on the Form W2 by the employer:
The left side of the form contains alphabetically labeled boxes, and each box contains information about the employee. Here is the description of all alphabetical boxes:
- Box A –social security number of the employee is mentioned in box A so SSA can verify the information.
- Box B –the employer identification number(EIN) is recorded in the Box B of the Form
- Box C –Box C has the official or legal address of the employer who is filing the Form W2 for his employees.
- Box D –Box D has the internal control number that an employer has issued to the employee for accessing payroll information and relevant details.
- Box E –Name of the Employee
- Box F –Address of the Employee
The right side of Form W2 contains the numerically labeled boxes from 1 to 12. The numerical fields contain the following information:
- Line 1 –Wages, tips, other compensation
- Line 2 –Federal Income Tax withheld
- Line 3 –Social Security Wages
- Line 4 –Social Security Tax Withheld
- Line 5 –Medicare wages and tips
- Line 6 –Medicare tax withheld
- Line 7 –Social Security Tips
- Line 8 –Allocated Tips
- Line 9
- Line 10 –Dependent Care Benefits
- Line 11 –Nonqualified plans
- Line 12(a, b, c, d)
- Line 13 –choose the category from the statutory employee, retirement plan, third-party sick pay
- Line 14 –Any other information that needs to be disclosed
The bottom of the form also contained numerically labeled boxes from 15 to 20. These boxes are related to the state and local taxes withheld. The lines contain the following information:
- Line 15 –State issued Employer’s ID Number
- Line 16 –State wages, tips, compensation, etc
- Line 17 –State Income tax
- Line 18 –Local wages, tips, compensation, etc
- Line 19 –Local income tax
- Line 20 –locality name
How Do Employers File And Send Out Form W2?
If you have always wondered about filing and sending out Form W2, here is a step-by-step guide to understanding the process of Form W2.
Step 1: Order Form W2
You are wrong if you believe that you can easily download Form W2 from the IRS website. You cannot randomly download Form W2 as per your need. Instead, you will need to order the Forms from the IRS depending on the number of employees.
The mandatory requirement for Form W2 is that the form must be scannable by the Social Security Administration.
You should not download the forms and file them with the SSA, as the department won’t be able to scan these forms. Therefore, the first step to filing Form W2 is to order them from the IRS. However, IRS also gives the option of e-filing Form W2.
Step 2: Fill Out The Form W2
Once you have the Form W2 with you, the next step is completing and filling out the form. You will need to enter the accurate information of every employee in the relevant boxes and lines, as we have discussed in the previous section.
Step 3: Make Copies Of Form W2
The next step for the employers is filling in the information on the copies of the W2. The following copies of the Form W2 have to be created for every employee:
Copy A: Employer will e-file or mail copy A to the SSA(Social Security Administration) together with Form W-3
Copy B: The employer will send Copy B to his employee, and the employee will attach the copy to Federal Income Tax Return.
Copy C: Copy C is also to be sent to the employee for his own records
Copy D: Copy D will be kept by the employer for business record
Copy 1: If there is a requirement for a state, city, or local tax return, Copy 1 is sent to the concerned department
Copy 2: Copy 2 has to be sent to the employee for filing state, local, or city tax return
Step 4: File The Form With SSA
If the employer wants to file the form by mail, the next step is to file the form with the Social Security Administration. In the case of electronic filing, the form will be submitted online. The benefit of electronic filing is that it will save time, and you can complete and file Form W2s for 50 employees at a time.
Step 5: Furnish W2 Copy To Employees
The next step is furnishing the relevant copies of the Form W2 to the employees at their mailing addresses. According to the instructions of the IRS, every employer must send Copies 2, B, and C to their current employees.
1. What to do if I don’t receive Form W2 from my employer?
If you have not received Form W2 from your employer, the first thing to do is contact your employer/HR department to confirm if your employer has dispatched the form. If the form hasn’t been delivered to your mailing address, you can request a duplicate Form W2 from the employer.
2. What if an employee quit working for me before the year-end?
Such an employee becomes your formal employee, but you must send the form to your employee before the 31st of January of the current year. If you have received the request for Form W2 from your previous employment, you are obligated to process the request within 30 days.