12 Nov / 2017

Short Course on Options – What You Need To Know

W2 Forms: How to Create and File Income Returns

Each and every person who is employed and their employer pays them on a non-cash basis, there is need to fill out the W-2 form for any amount equal to six hundred dollars and above. The form simply indicates the income paid as well as the social security number of the employee, and taxes withheld. When an employee is preparing tax returns for a given year, it is on the W-2 form where the tax withheld is deducted from the tax that is due. In case the amount withheld from an employee’s income is more than necessary, it is possible for the employee to get a refund from the Internal Revenue Service.

It is important that employees know that the amounts they file should match with the one on the W-2 form sent to the Internal Revenue Service as failure to match them can lead to suspicion for them. It is normal for every employee to have three W-2 forms. The first form is sent to the Internal Revenue Service, the second one is sent to the employee while the third one is kept by the employer for record keeping.

The W-2 form must be completed by an employer and then sent to the employees by mail on or before January 31st. All submissions should be done on or before February 29 as that is the deadline set by the Internal Revenue Service. There are usually six copies for every W-2 form. Written below is how the copies are broken down.

The first copy also known as Copy A is submitted to the Social Security Administration by the employer. The other copy, Copy B is sent to the employee whereby the employee files federal income tax returns. Copy C is the third one and this copy is usually sent to an employee so that they can keep their own records. The fourth copy, Copy D is kept by the employer also for purposes of record keeping. There’s a fifth copy is known as Copy 1 which the employee files for purposes of state or local income tax returns if any. The sixth copy, Copy 2 is meant to be the employers copy so as to file for state or local income tax returns, if any.

In conclusion, filing for income tax returns should be taken seriously by both employers and employees. This is due to the fact that if either fails to play their role, they can be met with serious consequences coming from the Internal Revenue Service. All employees entitled to wages and salaries must fill the W-2 forms and submit as required to avoid getting penalized.

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