Understanding Your Form W-2, Wage and Tax Statement

After December 31st, you will receive Form W-2, Wage and Tax Statement. This form is the year-end summary your employer provides you showing your wages and other compensation, as well as the amounts withheld for Federal income tax, Social Security tax, and Medicare tax, discussed in lesson How Your Paycheck Works.

Form W-2 also includes information such as your employer’s name and identification number, your Social Security number, and applicable state and local wages and taxes.

Depending on your benefits, the W-2 may also report items such as 401(k) contributions, certain employer-provided benefits, and other compensation or deductions.

Your employer is generally required to provide your Form W-2 by January 31 following the end of the tax year. This deadline is designed to give you the wage and tax information you need to prepare your Federal and state income tax returns.

Depending on your employer, your W-2 may be mailed to your home address, hand delivered to you directly, or made available electronically through your employer’s payroll company or employee portal. If your W-2 is provided electronically, you may need to log in and download it yourself, so don’t assume it will automatically arrive in the mail or by email.

If you have not received your W-2 by early February, contact your employer or payroll department to make sure it was sent to the correct address or made available electronically. You are ultimately responsible for filing your tax return on time, even if a tax document is late or missing.

Much of the information on your W-2 ultimately makes its way onto your Form 1040, US Individual Income Tax Return, which is why the W-2 is one of the most important documents you’ll need when preparing your tax return due annually on April 15th of the following year.

Each box on the W-2 reports a specific dollar amount or other information that may beentered on your tax return. These amounts become part of the calculations used to determine your taxable income, total tax liability, and taxes already paid through Federal withholding. See lesson Preparing Your Form 1040, Individual Income Tax Return to learn how to complete this tax return.

Final Thoughts

Your Form W-2 summarizes what you earned and the taxes withheld from your paycheck during the year. Review it for accuracy, keep it with your tax records, and use it to prepare your annual income tax return. If you have not received it by early February, contact your employer.

Very truly yours,

Aunt Anna