Form W-2
Form W-2 is the annual wage and tax statement an employer must give every employee who was paid wages during the year, reporting total taxable wages plus federal, state, and local income tax and FICA tax withheld. Employers file Form W-2 with the Social Security Administration and furnish a copy to each employee by January 31 of the following year.
What’s reported on a Form W-2
A Form W-2 reports far more than a single wage total: Box 1 shows federal taxable wages after pre-tax deductions, Box 3 and Box 5 show wages subject to Social Security and Medicare tax before those same pre-tax reductions apply, and Boxes 2, 4, and 6 show the tax actually withheld in each category. Separate boxes report state and local wages and withholding for employees whose work is subject to state or local income tax, which can differ from the federal wage figures when a state treats certain deductions differently. Because these figures can each differ from gross pay and from each other, an employee comparing their final pay stub of the year to their Form W-2 is checking two numbers that are supposed to reconcile, not duplicate, each other. Employers who make a payroll correction after year-end must issue a corrected Form W-2c rather than a second original.
Form W-2 deadlines and where it goes
Employers must furnish Form W-2 to every employee, and file it with the Social Security Administration, by January 31 of the year following the wages it reports, whether filing on paper or electronically. Employees use their Form W-2 to file their personal income tax return, since it reports the exact wages and withholding the IRS already has on file for them, and a mismatch between a tax return and the employer’s filed W-2 is a common trigger for an IRS notice. An employer that pays both W-2 employees and 1099 contractors issues each type of worker the correct year-end form: W-2 for employees, 1099-NEC for contractors, never one form for the other. Missing the January 31 deadline for either furnishing or filing Form W-2 can result in per-form penalties that increase the later the correction is filed.
Generating an accurate Form W-2 for every employee depends on gross pay, tax withholding, and benefit deductions all being tracked correctly throughout the year, not just reconciled at year-end. WageTime includes year-end W-2 and 1099 generation and e-filing as part of running payroll, with every federal, state, and local tax filed automatically all year.
See how WageTime handles year-end tax formsFrequently asked
What is the difference between Form W-2 and Form W-4?
Form W-4 is filled out by an employee when they’re hired to tell an employer how much tax to withhold; Form W-2 is issued by the employer after the year ends to report what was actually paid and withheld.
Does every worker get a Form W-2?
No. Only employees receive a Form W-2; independent contractors paid $600 or more in a year receive a Form 1099-NEC instead, since contractors are not subject to payroll tax withholding.