Your employer hands you a form on that kind of paper that just feels important, you know? It’s addressed to you and looks all official, though you have no idea what it says. The top very clearly says W-2 Form but all you can think about is how much W-2 sounds like someone just sneezed. Learning to understand and fill out this questionable form will definitely prove to be beneficial for you in the long run. It may sound like a bore, however when next tax season comes around, you will fill out this form like a pro!
Continue reading for more insight!
What Even Is A W-2 Form?
The IRS Form W-2, the “Wage and Tax Statement,” reports an employee’s income from the prior year, how much tax the employer withheld and other information. Employers send employees a Form W-2 in January (and a copy to the IRS). Employees use Form W-2 to prepare their tax returns. If you got paid more than $600 by an employer, you qualify to receive a W-2 form from that establishment. If you were employed at more than one job in a year, you will receive a W-2 form from each previous employer. Whether you receive one or 12, the significance remains all the same.
People commonly confuse the W-2 forms with W-4 forms. The only difference among the two is one number, so how different can they be? Not by much, but it serves a different purpose. Also coming from the IRS, the W-4 Form gets completed to let your employer know how much money to withhold from your paycheck for federal taxes.
“A W-2 is a summation of your salary and how you elect to be taxed on it. The W-2 will list any pretax deductions you’ve elected to take as well as how much tax employers should withhold from your paycheck. It is very important to review the W-2 to make sure what is being reported is exactly what you instructed your employer to do,” Graziano and Company Accountant Joseph Castanza said.
Completing this form correctly can help prevent one from being stuck with a big balance due at tax time. Let’s face it, we would all rather receive money than owe it.
How Do I Retrieve My W-2 Form?
Oftentimes your current employer will hand you your W-2 form or mail it to your house. Previous employers from that same year will mail it to the last address they keep on file for you. If for whatever reason you do not receive your W-2 form by mid-February, and you already asked your employer, no need to worry! Other means to retrieve this form include visiting the IRS website or reaching out to human resources or to your payroll processor.
If none of these options work, you will need to provide information and estimate your earnings. Despite any delays, your tax return still retains a due date in April. The option to delay processing can be a fallback solution if the IRS informs you that they will try to verify your information.
When should I get my W-2?
The IRS mandates that employers send W-2 forms to the government and to employees by January 31. As long as the forms are mailed by January 31, the company won’t face penalties. These forms can also get sent electronically however, they mostly get issued by mail.
If you were eagerly awaiting the arrival of your W-2 and it seems as though it won’t show up in your mailbox any time soon, you can pick from a couple of options. First, check your calendar, search your email and then contact your company or the IRS. If it comes down to it, you can file without a W-2 or request more time.
Can taxes be done without a W-2 form?
While we all hope we will receive a check rather than dish one out, there’s no way to tell without a W-2 form. Without this form, doing your taxes will take longer. This form contains crucial information that would make the the tax process go much more smoothly, however, not impossible to file without it.
“The IRS requires employers to report wage and salary information for employees on Form W-2. Your W-2 also reports the amount of federal, state and other taxes withheld from your paycheck. As an employee, the information on your W-2 is extremely important when preparing your tax return,” Maltese & Weintraub Certified Public Accountants PLLC accountant Nataliya Malikin said.
You may be thinking, “How do I file my taxes without a W-2?” In order to do this, you can submit a Form 4852, a substitute for a Form W-2, with your return. This document asks you to estimate your wages and taxes withheld last year. Your final pay stub can help provide these figures. Not only do you have to provide the information, but you need to dig some up as well! The reason why people dread tax season seems to start to be making sense.
What makes you think that only you maintain access to your W-2 form?
This most likely sounds more cryptic than it should; all it simply means that avoiding this lovely form will do nothing to benefit you. Legally, employers must send copies of your W-2 to the Social Security Administration as well as to the IRS. Failure to follow up will cause unwanted attention from the IRS and from the state. Let’s face it, what’s worse than trying to dodge the IRS? The abbreviation would go from meaning Internal Revenue Service to “I’m Really Scared” very quickly.
What happens if I don’t pay my taxes?
Trying to get out of paying your taxes? Probably not the best idea.
“Always file your taxes timely to avoid additional costly expenses. Also, most people don’t realize that the average person receives a refund on their taxes annually due to the withholding on their W-2. If you don’t file a tax return within three years the IRS could keep that potential refund you are due and the taxpayer would lose out,” Senior Accountant of Mauriello Enterprises Monica Paterek said.
If you file your taxes but don’t pay them, the IRS will charge you a failure-to-pay penalty. The penalty hangs at 0.5 percent of your unpaid taxes for each month you don’t pay, up to 25 percent. Plus, you’ll owe interest on the unpaid amount. Often times interest can amount to a good thing, though not in this case!