If you’ve ever been an employer or an employee in America, chances are you’ve filled out, or at least seen, a W-2 form. That’s because this form is used by the Internal Revenue Service (IRS) to help estimate tax withholding.
If you earned taxable wages or compensation over $600, you should receive a W-2. Employers are required to send them, either through the mail or electronically, by Jan. 31 of the year taxes are due.
The IRS refers to Form W-2 as the Wage and Tax Statement. This document summarizes your income for the tax year and tracks the income, Social Security, and Medicare taxes that were withheld. Because a W-2 records the amount of taxes you’ve already paid, it’s an important document to have for completing your federal tax return
In addition to reporting how much your employer withheld in payroll taxes, sometimes referred to as FICA taxes, your W-2 provides tax reporting about other compensation such as employer-provided health insurance, retirement and health savings account contributions, dependent care benefits, and more.
Your employer must send you and the IRS a W-2 form for tax purposes. Employers who have 10 or more Form W-2s are required to e-file information returns with the IRS. You may hear some confusing jargon about Copy A, B, and C of the W-2 form, but this just refers to duplicates of the same form.
Copy A is for your employer to submit to the IRS, Copy B is for you to file with your tax return, and Copy C is tax information for your records. A Copy 2 of your W-2 form may also be included and reflects any state, city, or local income tax withheld.
Employers are also responsible for filing a Form W-3 for each of their W-2 employees with the Social Security Administration (SSA) to determine Social Security tax and earned benefits.
Although your employer files a W-2 associated with your Social Security number with the IRS, you are also responsible for including a copy with your individual tax return.
Read more: How to determine your tax withholding to avoid surprises
Staring down a W-2 form and not really sure what you’re looking at? With 20 different fields of information, there’s plenty to overwhelm the average taxpayer. Here’s what you’ll find in each box of the current Form W-2 Wage and Tax Statement.
On the top of a W-2 form is the employee name, address, and Social Security number. This is listed alongside the employer address and the employer’s identification number or the employer’s state ID number if applicable.
There’s also a box for a control number, which refers to a number your employer may have assigned you in their system.
Boxes 1 and 2
Box 1 shows your taxable income, including total wages and other compensation. Box 2 shows your federal income tax withholding for the year.
Boxes 3 and 4
These boxes are all about Social Security, including how much of your income is taxable for Social Security purposes and the amount of Social Security tax withheld.
Boxes 5 and 6
These boxes on the W-2 shows how much of your wages are subject to Medicare tax and the amount of Medicare tax you had withheld.
Boxes 7 and 8
These two boxes are for the extras you might have earned, such as tips, that are subject to Social Security taxes in box 7 and allocated tips in Box 8. The IRS defines allocated tips as “amounts your employer assigned to you in addition to the tips you reported.”
Boxes 9 and 10
If you don’t see anything in Box 9, don’t worry. It was a field for a tax credit that no longer exists. Box 10 reports how much you received from your employer in dependent care benefits.
Boxes 11 and 12
Box 11 has some confusing language about nonqualified plans, but this just refers to deferred compensation typically offered to executives. Box 12 shows other types of compensation, such as 401(k) or health savings account contributions.
Boxes 13 and 14
This line is a catchall for information that doesn’t fit elsewhere. Box 13 has three smaller boxes for reporting withholdings from an employer-sponsored retirement plan or sick pay. Box 14 is for all the leftovers like state disability insurance, union dues, and health insurance premiums.
At the bottom of your W-2 form, there may be additional boxes that reflect state tax information, such as any state income tax or local income tax withholdings. If your state or local government doesn’t offer or require automatic withholding, these boxes may be left blank.
Read more: Free tax filing: How to file your 2024 return for free
If there’s a mistake on your W-2, such as an incorrect amount or a misspelled name, point out the error to your employer and ask for a corrected form. It may take time and be a hassle, but if it involves a significant amount or big mistake, the IRS could issue a fine to your employer.
It’s worth waiting for the corrected form for your own peace of mind as well. If the taxable income on your federal or state return doesn’t match what’s on your Form W-2, it could trigger an IRS audit. The IRS has instructions for filling out a supplemental form in case you don’t get your corrected W-2 before the tax filing deadline.
If your W-2 withholdings were more than your tax liability for the year, the IRS will issue you a refund. But if you don’t want to wait until tax season to get your own money back next time, work with your employer to correct and adjust your withholdings.
Your employer is required to mail your W-2 by Jan. 31, but that doesn’t mean you’ll receive it by then. Wait until mid-February before you follow up, and check if you have access to a copy online or through your HR department.
If you don’t have your W-2 form by the end of February and your employer has been unresponsive, you can contact the IRS at 800-829-1040. They’ll follow up with your employer and send you a substitute form to fill out so you can complete your taxes.
2. What is the difference between a W-2 tax form and a Form W-4?
W-2 and W-4 forms are easy to confuse, but a W-2 is a form your employer fills out that reports how much you’ve made and the amount withheld for federal and state tax purposes. A Form W-4 is one you fill out that tells your employer how much tax to withhold.
A W-4, also referred to by the IRS as an Employee’s Withholding Certificate, tells the company or small business you work for how much you’d like to have withheld for taxes, depending on your marital status, how many kids you have, and other information.
All employees with taxable wages or compensation over $600 should receive a W-2. Some employees may even receive several W-2s if they worked more than one job during the calendar year.
The exception to this rule is self-employed taxpayers, such as independent contractors, gig workers, or freelancers. Unless they’re defined as statutory employees, these workers receive a Form 1099 instead of a W-2 form. Because they don’t have federal income tax withheld, these taxpayers can use the 1099 to calculate their taxable income and estimate any remaining tax obligations.
Read more: How do self-employment taxes work? A step-by-step guide
While it’s your employer’s responsibility to file a W-2 (and a W-3) with the IRS and Social Security Administration, you’ll also need to file one with your federal and state tax return. The exception is if you made less than $600, in which case the IRS will not require a W-2, but still encourages taxpayers to report the income.
Independent contractors and freelancers file Form 1099 instead of Form W-2, which details their taxable income and other compensation for the tax year.
