The IRS requires that employers report wage and salary information for employees using Form W-2. This form is also used to report other information, such as taxes withheld, employer fringe benefits, health savings account contributions, etc.
This information is submitted to the IRS and provided to each employee.
Who receives a Form W-2?
Employers must report wage and salary information for all employees for the previous year. An employee is defined by the IRS as a worker who is employed by the company and whose work is controlled and directed by the company.
The IRS states that a form must be filed for each employee for whom the following applies:
- You withheld any income, social security, or Medicare tax from wages regardless of the amount of wages;
- You should have had to withhold income tax if the employee had claimed no more than one withholding allowance or had not claimed exemption from withholding on Form W-4;
- You paid $600 or more in wages even if you did not withhold any income, social security, or Medicare tax.
There are very limited exceptions to having to file a Form W-2, including if you were not required to withhold any income, social security, or Medicare tax and if you paid the employee less than $600.
This form has been in use for a long time. It isn’t likely that it will undergo major modifications anytime soon. Be sure to review our Mastering Form W-2: Essential Guide to learn more about these forms.
Download our guide to understanding Form W-2 to become a master on filing these returns.
BoomTax, The Boom Post, and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors prior to engaging in any transaction.