When it comes to filing taxes, Form W-2 plays a crucial role. It is the form employers must use to report wages and other compensation paid to their employees for any tax year. This guide is designed to help you understand what Form W-2 is, when it needs to be filed, and how to file it correctly.
Being an employer comes with a lot of responsibility. One of the most important tasks is to provide each employee with Form W-2, which is essentially the form that employers must use to report wages and other compensation paid to their employees for any tax year. It’s also one of the forms that you must submit when filing taxes.
However, like most tax forms, it can be confusing and intimidating.
But don’t worry; this guide is here to help you understand what Form W-2 is, when it needs to be filed, and how to file it correctly. When you have a better understanding of Form W-2, the filing process will be much easier for both you and your employees. Let’s get started!
Understanding The Form W-2
Form W-2, also called the Wage and Tax Statement is used to report wages paid to an employee and any applicable taxes withheld from the employee’s paycheck. This form also includes information about the employer, such as their name and address. This form aims to report the wages and taxes withheld over a year to the employee and the Internal Revenue Service (IRS).
It is important to understand that Form W-2 is only required for employees, not contractors or independent workers. The IRS considers a contractor or independent workers self-employed, meaning they are responsible for reporting their taxable income.
Who Needs To File Form W-2?
Often the question arises as to who needs to file Form W-2. Generally, employers must file a Form W-2 for each employee from whom they have withheld federal income tax or Social Security and Medicare taxes. This means employers must issue a W-2 to any employee who has earned wages in the current tax year.
Employers must also withhold taxes from their income, such as bonuses and severance pay. And they must report Federal Insurance Contributions Act (FICA) taxes, including Social Security and Medicare taxes. Employers must provide employees with a copy of their Form W-2 by January 31 of the following year or within 30 days of an employee’s termination.
What Is The Information Included In Form W-2?
Form W-2 includes the following information:
• Employee’s name, address, and Social Security Number
• Employer’s name, address, and Employer Identification Number (EIN)
• Wage and salary income earned during the year
• Federal, state, and local taxes withheld by the employer during the year
• Employer contributions to an employer-sponsored health insurance plan, including any after-tax contributions made by the employee
• Total wages and salaries paid for the year, Social Security taxes, and Medicare.
The W-2 form includes any bonuses, severance pay, commissions, or other income earned during the year. It may also include information about tips reported to an employer, union dues, and voluntary after-tax contributions for retirement plans.
Additionally, if an employee was terminated during the year, a box on Form W-2 will indicate the termination date.
Finally, the W-2 form includes any tax deductions that may have been allowable for the employee during the year, such as alimony paid or contributions to a Health Savings Account.
Deadline For Issuing and Receiving Form W-2
Employers are required to provide each employee with a completed Form W-2 by January 31 of the following year. Employees should then review their W-2, sign it, and keep it in a safe place for their records. Employees should also keep any supporting documents used to calculate the amounts on their Form W-2.
eFile Your W-2 With Tax1099: The IRS Authorized E-file Service Provider
You must file your W-2 forms on time and accurately as an employer. Tax1099 is an IRS-authorized eFile service provider that makes filing Form W-2 quick, easy, and secure. With Tax1099’s intuitive interface, you can easily upload multiple files in any format, review the data to ensure everything is correct, and submit them in minutes. Plus, our signature service assures you that your W-2 forms are being signed and sent quickly and securely to the IRS.
Features of Tax1099 that make filing W-2 easy and hassle-free.
• Bulk Upload: Tax1099 allows you to upload multiple files in any format, making it easy to submit your W-2 forms.
• Real-Time TIN Match: A wrong TIN can cost you up to $280 per form and even lead to penalties. Tax1099’s validation feature helps you verify that the TINs on your forms are accurate and valid, so you can avoid costly mistakes.
• Integration With 11+ Accounting Software: Tax1099 is integrated with 11+ accounting software such as QuickBooks, Xero, and Freshbooks, making importing your data into the software easier.
• 256-Bit Encryption: All data is securely stored and transmitted using 256-bit encryption, ensuring your information remains private.
When it comes to filing taxes, Tax1099 makes it easy. From importing data to generating and printing forms, the platform is designed to make life easier for businesses of all sizes. So don’t wait; sign up for Tax1099 today and start accurately preparing and filing your taxes.