What Is A W-2 Form? Everything You Need To Know (2024)

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If you’re an employee, Form W-2 is one of the most important forms you’ll receive at tax time. It includes information about the income and benefits you received during the tax year, so you’ll need it when preparing your tax return. With that in mind, here’s a breakdown of what a W-2 form is and how it works.

What Is Form W-2?

Also known as a “Wage and Tax Statement,” Form W-2 is a document that reports your annual wages and the amount of taxes withheld from your paycheck and sent to the IRS. It also shows other information such as how much your employer paid for your health insurance and any money you received in dependent care benefits.

Employers are required to send matching copies of this document to each of their employees and to the Social Security Administration (SSA) at the end of every tax year. As an employee, you’ll use this form to prepare your tax return. If you’ve worked multiple jobs during the year, you’ll enter each W-2 form separately.

The total amount of taxes withheld from your paychecks reduces your total tax liability. If the total amount withheld from your paychecks is greater than the total amount you owe, you’ll get a tax refund. The opposite is true, too. If your employer hasn’t withheld enough taxes, then you may owe the IRS.

Keep in mind that the IRS uses a cross-checking program to ensure you report all of your W-2 income. If the amount reported from your W-2s doesn’t match the amount on your tax return, the IRS may delay your tax return.

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Who Is Responsible for Filing Form W-2?

Employers must file Form W-2 and provide employees with copies. Employers must provide W-2s to their workers no later than Jan. 31 each year, either by mail or electronically. The deadline should leave you plenty of time to file your return by the annual tax deadline, which is typically April 15.

That said, if you don’t receive your W-2 form during that window, it’s your responsibility to make sure you get a copy and file your return on time.
Here are some steps you can take to ensure that happens:

  • Ask your human resources department or employer. More often than not, a missing W-2 form is a result of a clerical error. Verify the information your employer has on file for you, particularly your mailing and/or email address.
  • Contact the IRS. If your employer is unable to help you, then you can request your wage and income transcript from the IRS. You can request a copy of your transcript by using the IRS Get Transcript tool or calling 800-908-9946. Requesting a copy online will be faster than receiving one by mail.
  • File an extension. If Tax Day is on the horizon and you still don’t have your W-2 form in hand, think about filing for an extension while you wait for it to arrive.
  • Estimate your income and withholdings on your return: If you’re unable to file an extension or get a copy of your W-2 in time to file your tax return, consider estimating your income and withholdings and filing your taxes using Form 4852. You can amend the return once you receive the proper paperwork.

How Do I File a W-2 With My Taxes?

When preparing your taxes, enter the information from your W-2 form onto your income tax return (Form 1040). You can do so either electronically or by hand. Many of the best online tax preparation tools allow you to import this information directly from your payroll provider.

How To Read Form W-2

Now that you know more about what a W-2 form is and how it works, the next step is learning how to read it from start to finish. Here’s an explanation of each of the boxes on the form.

  • Boxes A to F: Provide information about you and your employer, including the name and address of the employer, your employer’s EIN and state ID, and your Social Security number.
  • Box 1: Shows the total amount of income you received through wages, tips or other forms of compensation.
  • Box 2: Shows how much federal income tax was withheld from your pay.
  • Box 3: Shows how much of your wages is subject to Social Security tax.
  • Box 4: Shows how much Social Security tax was withheld from your pay.
  • Box 5: Shows how much of your wages is subject to Medicare tax.
  • Box 6: Shows how much Medicare tax was withheld from your pay.
  • Box 7: Shows any tip income you reported to your employer that’s subject to Social Security tax.
  • Box 8: Shows tip income that was allocated to you by your employer.
  • Box 9: Box 9 should be blank. It deals with a tax perk that’s no longer in use.
  • Box 10: Reports how much you’ve received in dependent care benefits.
  • Box 11: Shows how much money was distributed to you from your employer’s taxable deferred compensation plan.
  • Box 12: Shows miscellaneous forms of income you’ll report to the IRS, such as 401(k) contributions. Each type of income has its own code, and they’re detailed in the IRS Form W-2 instructions.
  • Box 13: This box is designed to report pay that is not subject to withholding for federal income tax, such as contributions to employer-sponsored retirement plans.
  • Box 14: This box serves as additional space for any information that may not fit elsewhere in the form, including union dues or disability insurance costs withheld.
  • Boxes 15 to 20: Show state tax information, including how much of your pay is subject to state income tax and the total amount that’s withheld.

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FAQs (Frequently Asked Questions)

How much money do I need to make to get a W-2?

Generally, you can expect to receive a W-2 either electronically or by mail if you earned at least $600 from a particular employer. However, if your employer withholds any amount of tax from your paycheck, you will receive this form.

What should I do if I’ve lost my W-2?

The best thing to do is to contact your employer or human resources department and ask them to issue you another copy. However, barring that, you can also receive a copy by calling the IRS and asking them for assistance.

What’s the difference between a W-2 and a W-4?

While both of these forms are required by the IRS, Form W-4 is filled out by the employee and tells your employer how much tax you would like withheld from your paycheck. On the other hand, Form W-2 shows the IRS your total earnings during the tax year.

What’s the difference between a W-2 and a 1099?

A W-2 form is used to report income for employees who have taxes withheld from their paychecks by their employers. On the other hand, a 1099-NEC is used to report income for independent contractors who are responsible for covering their own employment taxes.

What Is A W-2 Form? Everything You Need To Know (2024)

FAQs

What Is A W-2 Form? Everything You Need To Know? ›

A W-2 tax form shows important information about the income you've earned from your employer, amount of taxes withheld from your paycheck, benefits provided and other information for the year. You use this form to file your federal and state taxes.

What is a W-2 form simple explanation? ›

Form W-2, also known as the Wage and Tax Statement, is a document an employer sends to each employee and the Internal Revenue Service (IRS) and shows income earned from an employer and the amount of taxes withheld from an employee's paycheck so taxpayers can file federal and state taxes.

What important items are detailed in your W-2 form? ›

Box 1: Details how much you were paid in wages, tips, bonuses and other compensation. Box 2: Shows how much federal income tax was withheld from your pay by your employer. Box 3: Shows much of your pay in Box 1 was subject to Social Security tax. Box 4: Shows how much Social Security tax was withheld from your pay.

What does the W-2 form tell you Quizlet? ›

The W-2 form reports an employee's annual wages and the amount of taxes withheld from his or her paycheck.

What is a Form W-2 answers? ›

Form W-2 is completed by an employer and contains important information that you need to complete your tax return. It reports your total wages for the year and the amount of federal, state, and other taxes withheld from your paycheck.

What does the Form W-2 determine? ›

Employers are required by the Internal Revenue Service (IRS) to report employees' wage and salary information on Form W-2. The amount of federal, state and other income taxes withheld from the employee's paycheck during the calendar year is reported on the Form W-2.

What are the rules for filing W-2? ›

W-2 at a Glance
  • Who: All businesses with employees.
  • When: W-2 forms must be mailed to recipients by January 31, and e-filed with the SSA by January 31 each year. State filing deadlines vary by state.
  • Where: To the IRS.
  • Why: To report an employee's wages, tips and other compensation.

Is it better to claim 1 or 0? ›

By placing a “0” on line 5, you are indicating that you want the most amount of tax taken out of your pay each pay period. If you wish to claim 1 for yourself instead, then less tax is taken out of your pay each pay period.

How do I calculate my W-2 income? ›

Box 1 shows the amount of gross taxable wages an employer paid. These wages include prizes, bonuses, fringe benefits, and salaries. This part of Form W-2 does not include amounts given to retirement plans or other payroll deductions.

How much will I pay in federal income taxes if I earn $40000? ›

If you are single and a wage earner with an annual salary of $40,000, your federal income tax liability will be approximately $4,000. Social security and medicare tax will be approximately $3,000. Depending on your state, additional taxes my apply.

What are important guidelines for W-2? ›

Distributing IRS Form W-2

Employees should receive their W-2 forms either electronically (with consent) or via mail to their last known address. Employers are also required to file copies of Form W-2 with the Social Security Administration (SSA) and relevant state tax agencies by the same deadline.

What is the main purpose of a W-2 form? ›

IRS Form W-2, or a “Wage and Tax Statement” is a tax form that reports the wages an employee earned during the year, as well as any taxes their employer withheld. This is an essential form you need to file your taxes as it often determines the size of your refund — or if you'll owe taxes.

Which best summarizes the purpose of a W-2 form? ›

This form summarizes the employee's earnings and the total tax withheld during that year. While the W4 captures details like the employee's personal information, marital status, number of dependents, and the desired amount of tax to be withheld, the W-2 is a comprehensive annual statement.

What are two ways to file your taxes? ›

A tax return can be electronically prepared with tax preparation software, or it can be prepared manually on paper forms.

How does a W-2 job work? ›

A W-2 employee can be full-time, part-time, or temporary. The W-2 classification refers to the employee's tax status, not their work hours. W-2 classifies the individual as an employee for tax purposes, and they receive a W-2 form from their employer at the end of the tax year.

Is the W2 form necessary? ›

Employers must complete, file electronically or by mail with the Social Security Administration (SSA), and furnish to their employees Form W-2, Wage and Tax Statement showing the wages paid and taxes withheld for the year for each employee.

What happens if I don't file a W-2? ›

Penalties range from $60 to $630 per form for the 2023 tax year and are usually based on when the correct Form W-2 is filed after the missed deadline.

What is the difference between a W-2 and a w4? ›

A W-4 is a form the employee fills out upon hiring to let an employer know how much to withhold from their paychecks. A W-2 is a form the employer fills out each tax year to record how much an employee was paid and how much tax was withheld.

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