Essential Things you Need to Know about the W-2 Form
Most people seem to hate tax season for various reasons. That is because many people experience a lot of stress during this time. Lack of preparedness is usually the main reason for this. It is important to know every little detail about filing your taxes.
It is unfortunate that most people procrastinate to find out matters related to taxes they need to pay or returns they should file. As an employee, you must have found a form with several tiny boxes in the mail around January or early February. This is a W-2 form and not a bill. If you made at least $600 from an employer in a year, they are legally obliged to send this form to you.
Initially the form was referred to as the wage and tax statement. In the form you will find information on how much you have been compensated with for your services. This is a crucial form for many because the information on the form whether you will write a check or get a refund. Below are some things you need to know about the W-2 form.
The form is Necessary for Filing Returns
As you prepare to do your taxes, there are many forms you should know about. The W-2 form is an example of one of the forms you should be aware of. This is a necessary form when you are doing your taxes. The form will tell you how much you have earned in the year that has passed. Additionally, it will tell you the amount you have paid in taxes during the past year. The form requires you to fill in several important details.
Form W-2 Deals With More than Just Payment
Of course, your W-2 shows the amount you made in wages and tips. Nevertheless, the form also details other information. Some of these things include the contributions you made towards your retirement during the year and amount paid towards health insurance by your employer.
The W-2 form is Not a Secret
Employers are required by the law to send copies of the W-2 form to the SSA, and your local tax authorities. This means that if decide that not to fill in the form and exclude the information from your tax returns you will get away with nothing. The only thing you are likely to experience is many letters from the IRS, which will only stress you the more. If the state has income taxes, you are also likely to get some letters from them too.
Employers need to furnish the Forms by January 31st
By the 31st of January every employer is expected to have sent the forms to the necessary addresses. By week one of February employees need to have their W-2 forms in the mail. Employers can easily create the forms online using W-2 form generators.