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Tips For Filing Your W-2 & W-3 Forms

Tips For Filing Your W-2 & W-3 Forms

All businesses that have employees must submit an annual W-2 report containing information on total employee compensation and withholding tax for the year. If you have W-2 forms for submitting annual employee salary reports, it is easiest to file them online. Here's what you need to know to file these forms electronically.


What is the IRS W-2 Form?

The W-2 forms are used to document and register employee wages and salaries and taxes withheld to the Social Security Administration (SSA). W-2 is issued by the IRS (Internal Revenue Service). But you have to submit these forms to the SSA, which shares the information with the IRS for income tax purposes.

A W-2 form must be issued to each employee for whom Federal Insurance Contribution Act (FICA) taxes are withheld, that is, Social Security and Medicare taxes and Federal, state, and local taxes. You should also issue a W-2 form to anyone whose income tax should have been withheld but did not do so for some reason (person who requested an exemption from withholding at source, for example).

The W-2 form includes information on

  • Federal withholding tax

  • Salaries, tips, and other taxes

  • Social security and Medicare salaries

  • Social security and Medicare taxes withheld

  • Social security and Medicare tips withheld

Also, it includes information on state and local government wages and tips, as well as the taxes withheld for each.


What is the deadline for submitting a W-2 Form?

The deadline for submitting W-2 forms to SSA is January 31st of the following year, so for W-2 2021 forms, the deadline is January 31st, 2022. The change was implemented in 2015 to help prevent fraud, and the date applies both on paper and online. Your requests will be considered on time if they are filed before this date.

You must also send W-2 forms to employees by January 31st. It is good practice to give these forms to your employees at the beginning of January so that they can review them and make any necessary corrections before the due date.


How do I file W-2 forms online?

You can file W-2 forms electronically online at the SSA Business Services Online website. It's free and secure, and it's SSA's preferred method of sending paper documents. First of all, you must register on the Social Security Administration Business Service Online website. Then you can create and save W-2 forms using a special file format and submit them to the site.

The business service online website offers two options. You can create up to fifty of these forms and print copies for distribution to your employees. Or, if you are using payroll software, you can download a payroll report to use when generating the form.

You can preview downloaded files and view error reports after file download, including name and Social Security number discrepancies. This lets you make the necessary corrections.

You can also check the status of your submission to see if the file has been accepted.


When to file W-3 forms with W-2 Forms

W-3s are filing forms that must accompany W-2s if you are filing hard copies. Summarize the information from all W-2 forms submitted to the SSA. If you electronically file your W-2 forms to SSA online using the business service online portal, it will generate your W-3 form automatically, so you do not need to submit the form.


When to File W-2 Forms Online

Beginning in fiscal 2021, if you complete 100 or more W-2 forms in a calendar year, you must electronically file them unless the IRS grants an exemption. You must apply online for fiscal years beyond 2021 if your company has ten or more W-2 forms to submit.

You could be fined if you do not file an electronic file when required. Of course, you can start filling out all of your W-2 forms online at any time to ensure you meet the requirements.


The advantages of electronic filing of W-2 forms

Electronic filing saves time and effort and helps ensure accuracy. You are not required to calculate and submit a W-3 submission form, as the Social Security Administration will automatically generate a W-3 when you submit the W-2 form.

You can also file W-2c (Corrected W-2) forms on the business service online website to correct an error if you make a mistake on one or more W-2 forms after submission.

You can also use the business service online website to verify Social Security numbers for payroll reporting purposes. The site provides tutorials, manuals, a checklist, and other useful information to electronically help you submit these forms.


How do I file a correct W-2 Online?

To correct the W-2 forms after filing, you will need to use the W-2C (and W-3c if you have filed a W-2 document). You can use the form to correct forms for the current year and the previous year. You can submit this form through the SSA business service online website.


What happens if you don't complete the W-2 forms?

The IRS imposes penalties for any form that is not completed or not filed correctly. Penalties also depend on when the form is filed to SSA or given to employees, and penalties vary based on the size of your business. The penalties are much higher if the IRS determines that the employer intentionally ignored the reporting requirements.

You may want to look into filing an extension request and submitting forms as soon as possible to minimize penalties.

Summary

  • If you complete 100 or more W-2 2021 forms, you must file them electronically; copies cannot be sent on paper.

  • To file W-2 forms electronically, register on the SSA Business Services Online (BSO) website.

  • W-2 forms must be filed annually for all Social Security Administration (SSA) employees until January 31st of the year following the fiscal year (January 31st, 2022 for 2021 W-2).

  • You do not need to file the W-3 submission form along with the W-2 forms that you are filing online.


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