What is a W2 Form? Here’s the Complete Guide

We break down the W2 form – why and how to file it. Everything you would need to know in this easy guide at Locus Tax. Read more to learn all about it.

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Read on for the complete guide.

Our guide will help explain to you what the W2 form is and how to help you read it, annotate the information needed on Form 1040, and how to return it back to the IRS.

Employers are federally mandated by the IRS to report the salary and wage information of its employees and to the IRS itself, which comes in the form of the W2. Every year before April 15th, people will submit a form called 1040 (along with any other accompanying documentation), which the IRS requires every year.

What is W2?

The W2 form is a wage and tax statement, annotating how much money you made during the previous year. It also annotates the amount of taxes withheld and paid out to the state and federal governments during that specific year.

You do not need to fill out anything on the W2, as it’s your employer’s responsibility to ensure it gets filled out and gets to you on time. Regardless if you transition in-between different employers, the information fields of the W2 will always be in the same place.

What is W2 contract?

Also referred to as a contractual W2, it describes the status of the worker as not being a full employee of the company. Rather, the worker is an employee that’s temporarily filling a staffing position via an intermediary company.

Since the individuals in question are contractors, they do not get all of the benefits that employees get, and could be terminated by the employer at any time without notice.

When Do You Get W2?

Employees typically have their W-2 available via online or mailed to them directly from their employers. Your employers are required by law to have your W-2s available no later than January 31st to give you leeway in preparing to file your tax returns.

They will usually come as a mail form or digital file that’s stored in electronic format via a web portal (an example is MyPay for DoD and military employees). Read our step-by-step guide to getting your W2 form.

How Do You Read a W2?

When you’re looking at the W2 form, it is is split into multiple fields.

The fields consist of alphabetical and numeric boxes. The alphabetical boxes occupy the left side of the form, while the numeric boxes occupy the right and bottom sides.

2019 W2 form

THE ALPHABETICAL BOXES

Box a has your Social Security Number identifying that the form belongs to you. It also serves as tracking information for the IRS. Your employer’s identification number is annotated on box b while the name of your employer and the employer’s address along are reflected in box c.

On box d is the control number, which is handled by your employer’s payroll department.

Boxes e and f contains your legal name and your mailing address respectively.

THE NUMERICAL BOXES

Starting on the right side of the form, box 1 contains your gross wages from the previous year, including tips and compensation. That box deducts elective deferrals such as 401(k) plans and pretax benefits.

When you look at boxes 2 and 17, they will annotate the amount of federal and state taxes withheld (respectively) throughout the year.

Box 3 contains the wages taxed for the purpose of Social Security. On box 4, you’ll find the amount of Social Security taxes withheld from your wages from that year. Boxes 5 and 6 marks your wages and tips taxed for Medicaid, and the amount of Medicare tax withheld from your pay for the year. Self-reported tips and employer-attributed tips are reported on boxes 7 and 8.

You do not have to worry about box 9, as it’s in the process of getting removed due to expired requirements.

Box 10 marks the total amount taken out of your wages and attributed to dependent care assistance programs.

The total amount of money distributed to you from your employer’s non-qualified deferred compensation plan will be marked on box 11.

Box 12 reports different types of benefits and compensation marked by letter codes.

EXAMPLES:

A – RRTA tax on tips Uncollected Social Security

B – Medicare tax on tips that were uncollected (not additional Medicare tax)

For box 13, your employer will check the applicable box pertaining to you as an employee.

Box 14 will contain miscellaneous information that isn’t available anywhere else on the form.

Boxes 15 through 20 contains your state tax information.

Starting with box 15, your state employer’s identification will be marked here.

Box 16 marks your taxable wages if you’re subject to state income taxes.

The amount of state taxes withheld from your wages will be marked on box 17.

Local, city, and additional state income tax information will be reported on blocks 18 through 20.

Getting Assistance for Your Returns

filing your w2 form

You can also ask for help from tax specialists to help you in computing your tax information and determine whether you owe taxes or are getting a refund. There are also offline and online software programs you can use. Locus Tax can help compute your numbers as close as possible to get the most of your deductions.

You can also download yearly tax instruction booklets directly from the IRS website. Moreover, begin by determining what tax bracket you fall in based on your annual salary.

Other Tax Forms

Independent contractors receive form 1099 and are not given W2 since they are self-employed. In order to get some form of compensation, they would need to do at least $600 worth of work to ensure that it’s accounted for.

Validating Your Information

When doing your 1040, you need to make sure that all of the relevant information from the W2 matches that of the 1040.

The important thing from the W2 is your social security number. If the information doesn’t match between the two forms, the IRS will inquire as to why the information on the 1040 is different from whatever was reflected on your W2.

On the 1040 form, line 7 will have the information from box 1 of the W2 in reference to your income.

Line 62 of the Form 1040 will reflect your federal tax withheld from your pay.

For everything you need to know about Form 1040, read here.

Tax Filing Deadlines

Any time that you forward your 1040 to the IRS, you will need to include copies of the W2. Also, regardless if it’s in electronic form or snail mail your, tax filing information is due on April 15th every year.

However, state filing due dates are different for each state. You will need to find out from your state government websites to determine when your state taxes are due.

For accurate and easy tax filing, the IRS recommends e-filing your tax returns.

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