Definition
An IRS form that employers must issue to each employee annually, reporting total wages earned, federal and state taxes withheld, Social Security and Medicare taxes, and other compensation and deduction information for the tax year.
UK Context
Best Practices
- Begin W-2 preparation in early January to meet the January 31 deadline for both employee delivery and SSA filing
- Reconcile W-2 totals against quarterly 941 filings to ensure consistency before submission
- Verify employee names and Social Security numbers against SSA records using the Social Security Number Verification Service
- Implement a process for handling returned W-2s and tracking undeliverable forms
Frequently Asked Questions
When must employers issue W-2s?
Employers must furnish W-2s to employees and file with the Social Security Administration by January 31 following the end of the tax year. There are no automatic extensions for employee copies. Employers may request extensions for SSA filing under limited circumstances.
What is the difference between a W-2 and a 1099?
A W-2 is issued to employees and reports wages with taxes withheld. A 1099-NEC is issued to independent contractors and reports non-employee compensation with no tax withholding. The distinction depends on whether the worker is classified as an employee or independent contractor.
What if an employee's W-2 has an error?
The employer must issue a corrected W-2c form. Employees who discover errors should notify their employer promptly. If the employer does not correct the error, the employee can contact the IRS for assistance.