What are W-2 Forms?
A W-2 Form, also known as a Wage and Tax Statement, is a document that an employer needs to send to their employees as well as the IRS (Internal Revenue Services) in January. It declares an employee’s salary/ wage and tax, holding back information for the year that just passed. This form is a crucial document needed for preparing state tax and federal tax returns. These forms are solely provided to employees. Those who engage in self-employment or are independent contractors get a statement for earning on a Form 1099 instead of a W2 Form. W-2 Forms are also provided by third-party providers who offer sick pay to the worker. Also, in a given tax year or a financial year.
Key Takeaways
- Form W-2 is an IRS document that shows an employee’s annual earnings and the taxes deducted and paid to the government.
- Employers issue W-2 forms to employees every year for filing taxes.
- These forms report withheld income taxes as well as FICA taxes.
- The IRS relies on W-2s to monitor and verify individual tax responsibilities.
What is there on a W-2 Form?
It indicates the wages, salary information, and tips of an employee for the previous tax year, that is, from January 1 to December 31. Moreover, it also mentions the amount of state, federal, and other taxes like social security contributions, medicare, etc., an employer deducted from the employee paychecks.
In case the employer offered allocations from uncharted deferred compensation schemes, or dependent care advantages. They would also be counted and mentioned on the W 2 form. On top of this, Form also includes identification details of the employee like address, name, and social security number, as well as identification details of the employer such as name, state ID number, EIN number, and address.
These forms are sent by the employers to employees on or before January 31 every year. An employee can get it directly and quickly from the employer. However, if needed, the form can be received from the IRS or Social Security Administration as well.
Who Files Form W-2?
Form W-2 filling is done by these below criterias-
- An employer has to provide a W-2 form, which serves as a record of employment, compensation, and taxes withheld, to each employee. It gets to who received wages, salaries, or other forms of compensation during the year. Independent contractors and self-employed individuals do not fall under this category because they have different tax forms.
- Employers are required to provide the W 2 to employees by January 31 of each year so they can file their income tax returns by the usual April 15 deadline.
- Employers report wages and the amounts withheld for income taxes and FICA taxes using W-2 forms. The employer must also file copies of the W-2s with the Social Security Administration SSA by the end of January with Form W-3.
- The SSA uses these forms to determine employees’ Social Security benefit eligibility.
Note: W-2 forms report earnings from the prior tax year. For example, a W2 form received in January 2026 reflects income earned in 2025.
Information Reported on a W-2
Workers employed by more than one employer will receive a W-2 from each employer. The information from these forms are recorded on to Form 1040 manually or electronically.
All W2 form have the same general information on them. This includes federal and state tax information, employer information such as the EIN and state ID, total wages earned in a given year, taxes withheld for federal income tax, Social Security, Medicare, and any tips earned for that year.
Conclusion
Form W-2 is an essential document for taxes as it provides the details of the income and taxes paid by an individual in a year, helping in preparing the income taxes. An employer provides the form to the IRS and SSA.
FAQs
What is the meaning of W-2?
An W-2 form is an American form that states an individual’s yearly wages and the taxes paid by an employer.
What is the W-2 form in India?
There is no W2 form in India; the closest equivalent is Form 16, issued by employers for salary and TDS details.
Is W-2 the same as income tax?
No, a W-2 is not an income tax; it is a statement used to file an income tax return.
