This is How to Complete Form W2 for Your Workers
It is the tax season when many people rush to have their tax returns filed in time to avoid penalties. It is a requirement that every business should file their tax returns at the close of every trading year, so as to be in the government’s good books. The W2 form is among the many forms you are required to fill by the internal revenue service (IRS) for your employees as a business owner. It provides details of employees salaries, amount of tax payable and also any other money deducted from their pay. Anyone whose total earnings per year exceed US$ 600 is supposed to have W2 forms filled for them. The following are the steps to take to complete the W2 form.
Sort Your Employees into Categories
A number of factors are taken into considerations when classifying your employees. Part-time or fulltime employment basis, contractual agreement, as well as the salary scale of the employee, are some of the factors affecting this classification. You may also need to look at any other benefits due to an employee like tax and insurance reliefs, vacations and sick leave pay.
Collect the Relevant Information from Your Employees
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. Ensure that you collect this information before you begin the process so that the process will be as smooth as possible.
Look for the W2 and W3 Forms
You can access both the W2 and W3 forms for download at the Internal Revenue Service website. W3 is the accompanying form to W2 which bears the details and records of the employer. Once you access the site and register your business, you can have the forms downloaded. Another option is to have the forms filed online by accessing the social security website.
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
For your workers to file their own tax returns they need to have a copy of the completed W2 form. You are also expected to send another copy of the form to the state department of revenue. It is usually expected that you first print out the forms in the correct hard copy format before you submit them.