Form W-2 reports an employee's annual wages and the amount of taxes withheld from their paycheck. Employers must send Copy B/C to employees and file Copy A with the Social Security Administration (SSA) by January 31.
- Required for every employee paid wages during the tax year
- Electronic filing mandatory for 10+ W-2s
- Penalties range from $60 to $310 per late or incorrect form
What Is Form W-2?
Form W-2, Wage and Tax Statement, is an IRS information return that employers must file for each employee. It reports wages paid, federal and state income taxes withheld, Social Security and Medicare taxes, and other compensation details.
The W-2 is a multi-copy form. Each copy serves a different purpose:
| Copy | Recipient | Purpose |
|---|---|---|
| Copy A | Social Security Administration | Federal reporting |
| Copy 1 | State/local tax authority | State/local reporting |
| Copy B | Employee | Filed with federal tax return |
| Copy C | Employee | For employee's records |
| Copy D | Employer | Employer's records |
| Copy 2 | Employee | Filed with state/local return |
W-2 Boxes Explained
The W-2 contains lettered identifier boxes and numbered reporting boxes. Here are the key numbered boxes every employer should understand:
| Box | Name | What It Reports |
|---|---|---|
| Box 1 | Wages, tips, other compensation | Total taxable wages (excludes pre-tax deductions) |
| Box 2 | Federal income tax withheld | Total federal income tax withheld per the W-4 |
| Box 3 | Social Security wages | Wages subject to SS tax (capped at $176,100 in 2026) |
| Box 4 | Social Security tax withheld | 6.2% of Box 3 |
| Box 5 | Medicare wages and tips | All wages subject to Medicare (no cap) |
| Box 6 | Medicare tax withheld | 1.45% of Box 5 (plus 0.9% for wages over $200K) |
| Box 12 | Codes (various) | Retirement contributions, health insurance, and other items |
| Box 13 | Checkboxes | Statutory employee, retirement plan, third-party sick pay |
These three wage boxes often show different amounts. Box 1 excludes pre-tax retirement contributions and health premiums. Box 3 includes those but is capped at the Social Security wage base. Box 5 includes pre-tax deductions with no cap.
Filing Deadlines
All W-2 deadlines converge on a single date for the 2026 tax year:
Form 8809 can extend the SSA filing deadline by 30 days, but it does not extend the deadline for furnishing copies to employees. Employees must receive their W-2 by January 31 regardless.
Electronic Filing
Starting with the 2024 tax year, the IRS lowered the e-filing threshold to 10 information returns. If you file 10 or more W-2s combined with other information returns (1099s, etc.), you must file electronically through the SSA's Business Services Online (BSO) portal.
| Filing Method | When to Use | Key Requirements |
|---|---|---|
| BSO (SSA portal) | 10+ W-2s | Register for BSO account, upload EFW2 format files |
| Paper (Copy A) | Fewer than 10 W-2s | Use the scannable red-ink forms only (not printed copies) |
| Payroll software | Any volume | Software generates and transmits directly to SSA |
Corrections (Form W-2c)
Mistakes happen. When you discover an error on a previously filed W-2, use Form W-2c (Corrected Wage and Tax Statement) to fix it. File the W-2c with the SSA and provide a copy to the employee.
If the original W-2 was never filed (not just lost by the employee), issue a new original W-2 — do not use W-2c. Also, if an employee simply needs a replacement copy, reissue the original W-2 marked “REISSUED STATEMENT.”
Penalties for Late or Incorrect Filing
IRS penalties for W-2 failures scale with how late the correction is made:
| Timing | Penalty Per Form | Max Per Year (Small Business) |
|---|---|---|
| Filed within 30 days of deadline | $60 | $232,500 |
| Filed by August 1 | $130 | $664,500 |
| Filed after August 1 or not at all | $310 | $1,329,000 |
| Intentional disregard | $630+ | No limit |
If you have 50 employees and file all W-2s two months late, the penalty is $130 × 50 = $6,500. Intentional disregard penalties have no maximum cap.
Frequently Asked Questions
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Related Forms
Form W-4
Complete guide to the W-4 form — how employees claim withholding allowances, when to update it, and how employers process it for federal income tax withholding.
Form W-9
Guide to the W-9 form — when to request it from contractors, how to verify TINs, and how it connects to 1099 reporting requirements.
Form 1099-NEC
Complete guide to the 1099-NEC form — who gets one, filing thresholds, deadlines, electronic filing, and penalties for late or incorrect submissions.