What Are W2 Forms?
A W-2 form shows an employee's wages paid and taxes withheld for the year. The employer puts the wages earned and all taxes withheld for each employee in the respective boxes of the employee's W-2. Employers are supposed to postmark or deliver W-2 forms to the respective employees by January 31 of each year. The employer files the W-2 with the required agencies and gives the employee a copy so she can file her tax return.
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Applicable Employers
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Employers are supposed to prepare and file W-2s for employees from whom Medicare tax, Social Security tax and income tax was withheld, and if income tax would have been withheld if the employee had claimed a maximum of one withholding allowance or had claimed an exemption from withholding on his W-4 form.
Filing
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Employers are required to file employees' W-2s with the Social Security Administration. Those required to file a W-2 form must also file a W-3 form, a transmittal form that shows the aggregate amount of earnings paid and taxes withheld for all employees for the year. Employers have until March 31 if filing electronically, and until February 28 if filing by paper. The Social Security Administration sends the W-2 information to the Internal Revenue Service by late May or early June. If applicable, the employer files the W-2 with its state and local income tax collectors. The employee files her W-2 with the IRS by the tax-filing deadline, usually April 15, and if applicable, with her state and local taxation agencies.
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Incorrect W-2
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If the employee's W-2 is incorrect, such as the wrong Social Security number, wages paid or taxes withheld, the employer should issue him a corrected W-2 (W-2c) as soon as it realizes the error. The employer files the W-2c and a W-3c with the Social Security Administration. If applicable, it files the W-2c with state and local taxation agencies. It also gives the employee a copy of the W-2c so he can amend his tax return, if necessary. The employer does not have file a W-2c with the agency if the correction is only for an address change. In this case, it reissues the W-2 with the correct address and gives it to the employee.
Missing W-2
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An employee who does not receive her W-2 by January 31 should contact her employer to find out if and when the form was mailed, and ask for a copy if necessary. If she does not receive it by mid-February, she should report the matter to the IRS, which will contact the employer and request it to give the employee her W-2 form. If the employee does not receive her W-2 by the tax-filing deadline, he should file his tax return via Form 4852, Substitute for Form W-2, Wage and Tax Statement.
Penalties
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The IRS can penalize employers that fail to file a correct W-2. For example, intentional disregard of W-2 filing rules can result in a penalty of $250 per form. Further, an employer that files a fraudulent W-2, such as falsely claiming that it paid wages to an employee, may be required to pay the said employee civil damages of $5,000 or more.
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References
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