W2 Employer Laws
Employers are required to deliver/postmark W-2 forms to employees by January 31 of each year. If the deadline falls on a Saturday or Sunday, the Internal Revenue Service moves the due date to the next business day. Employers are required to abide by additional W-2 laws.
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W-2 Filers
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The following employers are required to file a W-2 form: those that withheld income tax from wages paid and those with employees from whom income tax would have been withheld if they had claimed a maximum of one withholding allowance or if they had not claimed exempt on their W-4 form. Additionally, if the employer pays the employer for services, including payments not made in cash, it must file a W-2 even if the employee is a relative.
Form Completion
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The employer lists the employee's wages/salaries/tips and taxes withheld for the year on her W-2 form. Taxes include federal income tax, Medicare tax, Social Security tax, and if applicable, state, city and local income tax. The amounts stated on the W-2 should match the year-to-date data on the employee's last pay stub. Accuracy is crucial when preparing a W-2--the employee uses the form to file her income tax return.
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Filing Deadline
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The employer gives the employee a copy of the W-2 to file her tax return. It files the W-2s and a W-3 (transmittal form which summarizes total earnings and withholding for all employees) with the Social Security Administration, which forwards the information to the IRS. The SSA requires paper filers to file W-2s by February 28; electronic filers have until March 31. The IRS matches the W-2 data that the SSA sends it with the information the employee submits on her annual tax return. If the two do not match, it's possible the employer made an error on W-2 or the employee on her tax return. In the latter case, the IRS typically corrects the error and sends the employee notification of the fix. If the employer made a mistake on the W-2, it must issue a corrected W-2 (W-2c).
W-2 Correction
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The employer files a W-2c and W-3c (corrected transmittal form) with the Social Security Administration--and gives the employee a copy--if the wrong information, such as tax year, earnings, withholding and Social Security Number was stated on the original W-2. The employee uses the W-2c to file an amended tax return with the IRS. The employer does not file a W-2c with the SSA if only the address on W-2 was incorrect. In this case, it can give the employee a W-2c with the corrected address, or mail--or otherwise deliver to the employee--the W-2 with the wrong address in an envelope that shows the right address.
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References
- Photo Credit tax forms image by Chad McDermott from Fotolia.com
