Tax and License

Everyone aspires to live in the capital of the United States of America, but due to stringent tax regulations, it is difficult. The IRS strictly notifies employees of any company that they should have W-2 forms by the end of January. But usually, it does not happen because the rule applies to mailing the W-2 form and not receiving it.

In this blog, you will encounter the introduction of the W-2 form and its importance for employees and employers in New York City.

An Introduction to the W-2 form 

It is an official record mandated by the IRS and has all the tax withholdings and wages of the previous year. W-2 Form is sometimes called a “Wage and Tax Statement.” In addition, the W-2 form also contains your retirement plan, such as 401(k), compensations and benefits, health saving accounts, and health care benefits.

W-2 Employee 

An employee who gets a W-2 form from his employer is a W-2 employee. The employee fills out the information in the form, which is a shred of evidence later when doing tax returns. 

Last date to send W-2 Forms 

IRS says that the employer should mail the W-2 forms to all the employees in his company before 31^st January every year.

What If You Still Need to Receive the W-2 Form?

The following are the steps to follow in case you haven’t received your W-2 form:

• The first thing to do is contact your employer and ask whether he has already mailed the form
• You must contact both companies if you worked at two places in a year or switched jobs. 
• It is possible that the company has emailed you a tax statement or they will notify you to collect your form from the office. 
• You must wait for the W-2 form at the beginning of February. But if it is mid-February and you still need to receive your form, call IRS. 

Who should fill out the W-2 form?

The employers fill out the W-2 form for you. You only have to receive it and use it to pay your tax returns. 

Error in your W-2 form

If your name is misspelt or the amount of tax is written wrong, you must ask the company to rectify the mistake and resend you the form. 

The difference between W-4 and W-2 forms

The W-4 and W-2 are separate forms used in the US to manage and submit taxes. The basic difference between the two is who fills out and receives the form. 

W-4 form (employee to the employer)

Employees utilize the W-4 form to communicate their withholding preferences to their employer, which decides how much federal income tax should be deducted from their paychecks. When starting a new job or experiencing a change in their personal or financial circumstances that may impact their tax situation, such as getting married, having a kid, or purchasing a property, the employee must complete a W-4 form.

W-2 form (employer to employee)

In contrast, businesses report the wages, tips, and other compensation their employees receive throughout the year on the W-2 form. This form also lists any additional deductions or benefits the employer provides, such as contributions to a 401(k) and the sums deducted for federal income tax, Medicare tax, and social security tax.

In conclusion, whereas employers use the W-2 form to report the wages and taxes paid to their employees, employees use the W-4 form to modify the amount of federal income tax withheld from their paychecks.

In addition to the W-2 form, there is a W-2G form.

This form represents your gambling winnings and reports it to IRS. The operator at the gambling place will fill out the form for you and hand it over to you. Or they can mail you W-2G Form. This form will help you in filing tax returns.

The W-2G form contains details regarding the gambling activity, the winnings’ amount, the event’s date and place, and any taxes withheld. The person who receives the W-2G form is expected to disclose any gambling winnings on their federal income tax return. Depending on their particular tax circumstances, they may also be required to pay additional taxes on the profits.

Author Bio 

Caroline Michaelson does Tax preparation in NYC at a tax agency. She is a graduate of accounting & finance and wrote her thesis on tax regulation. Moreover, she believes in work-life balance and goes camping with her twins on weekends. She loves baking and runs an online bakery as a side hustle.