This is How to Complete Form W2 for Your Workers
During the tax season, many people are usually in a hurry to file their tax returns in an endeavour to escape the penalties borne by those who fail to do this. All business are expected to have their correct tax returns filed before a particular date to ensure that they are tax compliant. The internal revenue service (IRS) requires that every business person fills out form W2 for their employees. The W2 form contains information about your employees’ wages, the amount of tax withheld from them as well as other deductions from their salaries. Any employee earning more than US$ 600 per annum is supposed to have the W2 forms filled. This is how W2 forms are normally filled.
Group Your Workers
Depending on various considerations, different employees are put into different classes. Some of these factors are the amount of salary an employee is paid, their type of employment: whether full time or part-time basis, or whether they have been engaged as contractors to serve a certain purpose. Other factors include insurance and tax reprieves, sick and leave allowances.
Gather the Right Details From the Workers
After classification of your workers, the next step is to obtain all the relevant details from them. The details to record includes salary amount, amount of tax due and also allowances and reliefs due to each employee. You will also need their names and addresses and also social security numbers. The information should be gathered beforehand to make it easier to fill the forms.
Obtain the W2 and W3 Forms
The Internal Revenue Service website contains both the W2 and W3 forms for downloading. W3 is the accompanying form to W2 which bears the details and records of the employer. To obtain the forms, you only need to register your business on the IRS website. The other alternative is to register at the social security website and have the forms filed electronically.
Complete W2 with the Collected Data
The form W2 obtained should then be completed with the relevant employee data. Ensure that you complete the forms as carefully as possible because mistakes made here could have serious consequences. The number of employees you have will determine the number of forms you fill since employee needs a single form.
Forward the Filled out Forms
The last step in this process is to have copies of the filled out forms presented to your employee so that they can also file their returns. The other copy is then submitted to the state department of revenue. The copies are usually printed first in the correct format and then forwarded in hard copy.