In this article, we will take you through all the details related to the W-2 form that is crucial.
What is a W2 Form?
W2, or the wage and tax statement, is an important financial document that is required at the time of filing taxes. The employer usually sends it to the employees at the beginning of the tax year. It reports employees’ annual wages and the amount of taxes that have been withheld from their salary.
This tax amount is paid to the federal and state government by the employer on behalf of the employee. The form has several sections represented by the boxes wherein items related to your income are indicated.
Significance of Form W-2: Wage and Tax Statement
Payroll vs. Income Tax – If you are an employee, you will receive the W-2 form at the very beginning of the year before the 31st of January. This ensures that the employee has plenty of time to file the taxes.
All the essential information you need to fill out the W-2 form is provided in Form W-4 and sometimes in Form W-9. For example, it has payroll, tax withholding, employer-provided benefits, employee contributions to retirement plans, Employer contribution to your health care, etc.
The W-4 form indicates the amount to be deducted from the employee’s paycheck. The amount is based on allowances, dependents, marital status, etc. Data from this form is needed when filling the 1040 form for Income Tax Return.
Which Income Groups Are Eligible to Get a W-2?
People earning $600 or more must fill out the W-2 form. If you fall in a lower income bracket, you need not worry about the W-2 form. Also, only working as full-time employees with an organization file the W-2 form.
If you are self-employed or working on a contract basis, you would not have to file the Wage and Tax statement. Instead, you will get an earnings statement on Form 1099.
Verifying Your Name and Social Security number
I cannot stress the importance of filling in your social security number correctly. To be on the safer side, always double-check it before filing the ITR.
Since the identifying information section of the W-2 form is a tracking feature, it will immediately show an error when there is a difference in the income report that you file and the information mentioned in the W-2 form.
The IRS also receives a copy of your W-2, so they will know instantly if the information does not match. Hence it is advisable to fill in the details very cautiously, and if the employer incorrectly fills the details on the W-2 form, it should be brought to his notice immediately.
If you have switched jobs, you will have to get the W-2 form from your previous employee. Find out how to get w2 of the prior employer.
What to do if I lose my W-2?
Most W-2s are available online for easy access. You can download a copy using your login credentials if you have it online. If you have forgotten your login Id and Password, you can request a reset.
However, if there is any other issue or you want to change any crucial details, you will have to contact your HR.
Therefore, we see that filing a W-2 is crucial yet simple to execute if done with care. All you have to do is fill in the details correctly and double-check them for the details.