Internal Revenue Service Form W-2 is provided to you by your employer each year, usually in January, before you file your tax return for the prior year. Your W-2 is a critical document because it details your past year’s earnings, as well as how much in federal, state, local or city income taxes you've already paid on your earnings through withholding.
You’ll receive a separate W-2 from each of your places of employment if you have more than one job.
IRS Form W-2 lets employees know how much they earned for the year, in addition to any taxes that were withheld from their pay. You'll use it to prepare your tax return.
An Overview of Form W-2
Form W-2 is an informational return. It literally informs you – and other key parties such as the IRS, the Social Security Administration, and state and local or city governments – of your earnings and what you've paid in taxes for the year through withholding from your paychecks.
You'll find other important information on your W-2 as well, such as how much you might have contributed to your retirement plan, such as a 401(k), and what your employer might have paid toward your health insurance coverage. This information can affect your taxable income and you must have it on hand to accurately prepare your tax return. Simply plug the information into the appropriate areas of your IRS Form 1040 to complete your taxes when you receive your W-2.
It’s a common misconception that your employer doesn’t have to send you a W-2 if you were paid less than $600 for the year, but this rule applies to other tax forms. Your employer is required to supply you and the IRS with a copy of your W-2 regardless of the amount you were paid for the year or whether you worked full- or part-time.
Form W-2 vs. Form W-4
You most likely filled out a Form W-4 when you started your job. IRS Form W-4, the Employee's Withholding Certificate, is used to determine how much your employer should withhold from your paychecks to cover your tax obligation or the year. You should also submit a new Form W-4 to your employer when you experience life changes that could affect your filing status, such as getting married or having children.
It used to be that you would calculate "allowances" on your Form W-4, but the Tax Cuts and Jobs Act effectively eliminated these from the tax code in 2018, at least through 2025. The IRS issued a new Form W-4 in 2020 to accommodate this change. The new form is much easier to understand and complete.
The W-2 and the W-4 have similar alphanumerical names, but they're quite different and they serve different purposes. Your W-2 isn’t a place for you to make adjustments to your income tax withholding. You can only do this on Form W-4.
Who Receives a W-2?
The W-2 form isn't used to report income paid to freelancers or independent contractors. They receive a different IRS form that details payments made to them during the year. You'll only receive an IRS Form W-2 if you are considered an employee and taxes were withheld from your pay.
Workers and independent contractors sometimes perform the same or similar tasks, and they can even work side-by-side for the same company, but workers have less autonomy with regard to how and when their job is performed. The IRS has very specific tests that determine who's an independent contractor and who qualifies as an employee. It's a clear indication that your employer considers you to be an employee if you were asked to fill out a Form W-4 at the start of your employment.
Using Your W-2 To Prepare Your Tax Return
You'll use the information contained on your Form W-2 to complete your Form 1040 tax return when the time comes, but not every box on Form W-2 will be transferred to your return. Some of the boxes are informational only, such as your employer's identification number.
Other boxes are worth paying special attention to, however, and some might require that you file other tax forms.
The IRS website provides exhaustive form instructions that walk you through using your W-2 to fill out your Form 1040 tax return.
The IRS indicates that approximately 90 percent of taxpayers e-file their tax returns. You don't have to include your W-2 when you file your return if you're one of these millions of taxpayers. You do have to provide your authorized IRS e-file provider with a copy of your W-2 before your electronic return can be submitted to the IRS, however.
You should keep your W-2 and a copy of your tax return in a safe location in the event the IRS ever decides to take a closer look at your return.
Read More: What Is eFile?
Important Boxes on Form W-2
The 2020 Form W-2 includes numerous boxes and lines, but some are more important for your tax-filing purposes than others. The lettered boxes on Form W-2 identify you and your employer:
- Box a shows your Social Security number.
- Box b cites your employer's identification number.
- Box c shows your employer's name and address.
- Box d is for your employer's records. It identifies a control number that links to your payroll processing file.
- Boxes e and f display your name and address. You'll want to check these for accuracy.
The numbered boxes pertain to your earnings and taxes withheld:
- Box 1 details your wages, tips and any other compensation you received. This is transferred to and reported on line 1 of IRS Form 1040. Notify your employer if you think this figure is incorrect.
- Box 2 contains the total amount of federal income taxes that were withheld from your earnings. This amount is entered on line 25a of your tax return. Contact your employer immediately and request a corrected W-2 if you notice any errors here. You can usually compare the number against your final paycheck for the year to check it for accuracy.
- Boxes 3 and 4 contain your Social Security wages and Social Security tax.
- Boxes 5 and 6 cite your Medicare wages and tax.
- Box 7 shows the amount of any tips you reported to your employer.
- Box 8 will include any money that was given to you by your employer for tips processed on a credit card.
- Box 10 shows any taxable dependent care benefits you might have received from your employer.
Refer to the IRS website and look for IRS Publication 531, Reporting Tip Income to learn how to accurately report your tips.
Read More: Tax Law on Claiming Tips
When to Expect Your W-2
Workers generally receive their W-2s in January or early February of the year following the tax year – for example, in January 2021 for their 2020 earnings. Employers face penalties if they miss the deadline. By law, they must issue Forms W-2 no later than Jan. 31. Look into the matter with your employer if you don't have your W-2 in hand by this date or shortly thereafter.
The delay might be the result of your employer having incorrect information for you, such as a previous address if you’ve recently moved. You can contact the IRS if necessary and the agency will reach out to your employer on your behalf to locate the missing form if you haven't received it by Feb. 15.
File Without Your W-2
The IRS will send you Form 4852, the Substitute for Form W-2, Wage and Tax Statement, or direct you to download it from the IRS website if you still don't receive a W-2 from your employer after they've been contacted by the agency. The form instructs you as to how to use your last pay stub of the year as a replacement W-2 so that you can get your taxes filed by April.
Your last pay stub of the year should include much of the same information that's reported on your W-2, so you can follow the instructions for IRS Form 4852 to approximate your W-2 and accurately complete your IRS Form 1040. Include a short explanation of any attempts that were made to locate your missing W-2 before you sign and submit Form 4852, and explain how you gathered the information you used to complete the form.
You can't e-file when you're using IRS Form 4852. You must mail in a paper tax return.
Review your tax return to make sure that what you reported is accurate and matches the information on your W-2 in the event that you receive your missing W-2 after you've filed Form 4852 with your tax return. Check with the IRS to find out if you should file IRS Form 1040X, the Amended U.S. Individual Income Tax Return, if you spot any discrepancies.
Not every mistake – such as a mathematical error – is sufficient reason to file an amended return, so check with the IRS or a qualified tax professional for guidance.
- IRS: About Form W-2, Wage and Tax Statement
- IRS: 2019 General Instructions for Forms W-2 and W-3
- U.S. Department of Health and Human Services: What’s the Difference Between an Independent Contractor and an Employee?
- IRS: Independent Contractor (Self-Employed) or Employee?
- H&R Block: What is the W-2 Form deadline — When Do Employers Have To Issue W-2 to Employees?
- IRS: About Form 4852, Substitute for Form W-2, Wage and Tax Statement, or Form 1099R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRA's Insurance Contracts, Etc.
- IRS: Amended Returns & Form 1040X
- H&R Block: What Do the W-2 Boxes and W-2 Form Codes Mean?
- Tulane University: W-2 Box Descriptions
- Internal Revenue Service. "About Form W-2, Wage and Tax Statement." Accessed Nov. 2, 2020.
- Social Security Administration. "Deadline Dates To File W-2s." Accessed Nov. 2, 2020.
- Internal Revenue Service. "2020 Form W-2." Accessed Nov. 2, 2020.
- Social Security Administration. “Social Security Wage Base Rises to $142,800 for 2021.” Accessed Nov. 2, 2020.
- Internal Revenue Service. "Employee Reimbursements, Form W-2, Wage Inquiries." Accessed Nov. 2, 2020.
Tara Thomas is a Los Angeles-based writer and avid world traveler. Her articles appear in various online publications, including Sapling, PocketSense, Zacks, Livestrong, Modern Mom and SF Gate. Thomas has a Bachelor of Science in marine biology from California State University, Long Beach and spent 10 years as a mortgage consultant.