Avoid IRS Issues by Completing Form W-2 Properly

As a small business owner, you are required to complete, file with the Social Security Administration, and provide your employees with a Form W-2, Wage and Tax Statement. This form is used to inform the Social Security Administration of an employee’s Social Security and Medicare wages for the applicable year. Since this is the only way that the Social Security Administration is able to obtain this information, the form is very important.

8 Tips to Help Business Owners Avoid Tax Issues With Form W-2

While Form W-2 is undoubtedly very important, it is unfortunately easy to make a mistake when completing and filing. In order to avoid a tax problem, we recommend the following helpful tips:

  1. Always type the form using black ink. A 12-point Courier font is preferred. This makes it easier for the machines to read the information, helping you to avoid problems.
  2. Do not use dollar signs or commas. Instead, decimal points should be used.
  3. Do not make erasures, cross-outs, or use correction fluid on the form. If you make a mistake, put an “x” in the void form and use the next Form W-2 to start again.
  4. Send in the entire 'Copy A' page to the Social Security Administration even if one of the forms on the page is blank or void. Do not cut or fold the page.
  5. If a box does not apply, leave it blank.
  6. If you find an error in an employee’s W-2 after it was already sent to the Social Security Administration, prepare and file a Form W-2c. This form is titled “Corrected Wage and Tax Statement.”
  7. Always file a Form W-3c whenever you file a Form W-2c with the Social Security Administration. This form is titled “Transmittal of Corrected Wage and Tax Statements.”
  8. If you file more than 250 W-2 forms, you must file electronically unless you have obtained a waiver from the IRS.

When a tax issue does arise, it is important to know that you are not alone. Learn how we have helped our past clients by checking out our client testimonials today.

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