![]() Form W-2 must be attached to one's individual tax return this is to substantiate claims of withholding. The employee receives three copies of Form W-2: one for the record, one for the federal tax return, and one for the state tax return. The Social Security Administration, court proceedings, and applications for federal financial aid for college may all use Form W-2 as proof of income. In this way, the IRS uses Form W-2 as a way to track an employee's tax liability, and the form has come to be seen as a formal proof of income. In addition, if an individual does not pay the required amount of taxes, the IRS will also know this. Since the IRS receives a copy of the W-2 from the employer, if the amount reported on the W-2 does not match the amount reported on Form 1040, the IRS may get suspicious. ![]() ![]() It is possible to receive a refund from the IRS if more income was withheld than necessary. When an employee prepares their individual tax return for a tax year, the withholding amount from Form W-2 is subtracted from the tax due. This deadline gives these taxpayers about 2 months to prepare their returns before the April 15 income tax due date. Īn employer must mail out the Form W-2 to employees on or before January 31. This information is used by the employee when they complete their individual tax return using Form 1040. Significance for employee's tax return įorm W-2 includes wage and salary information as well as federal, state, and other taxes that were withheld. It has led to the phrase "W-2 employees" to refer to those who receive Form W-2, in contrast to independent contractors and other "1099 workers" whose income is instead reported on Form 1099. If corrections are made, it can be done on a W-2c. In territories, the W-2 is issued with a two letter code indicating which territory, such as W-2GU for Guam. Relevant amounts on Form W-2 are reported by the Social Security Administration to the Internal Revenue Service. The Form W-2, along with Form W-3, generally must be filed by the employer with the Social Security Administration by the end of February. The form is also used to report FICA taxes to the Social Security Administration. An employer must mail out the Form W-2 to employees on or before January 31. Employers must complete a Form W-2 for each employee to whom they pay a salary, wage, or other compensation as part of the employment relationship. Form W-2 (officially, the " Wage and Tax Statement") is an Internal Revenue Service (IRS) tax form used in the United States to report wages paid to employees and the taxes withheld from them.
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