How to Fill Out W-2 Form for Employees in 2021
Jane Zhou updated on Jul 07, 2021 to PDF Knowledge Center
If you an employer, you must be familiar with Form W-2. It is a wage and tax statement that you need to send to your employees and the Internal Revenue Service (IRS) every year. But if you are a new employer or you are not sure whether your employees need the W-2 forms, you can get help from this article. Here we have prepared everything that you may want to know about Form W-2, like
- What is a W-2 form
- How to fill out the W-2 form ★★★
- How many W-2 forms do I need
- Where do I send the completed W-2 forms
So, if you have any questions or concerns about the above-listed items, keep reading this article to cut through the confusion.
You may also want to know how to fill out a W-9 form
The W-2 form is referred to a wage and tax statement, which shows how much money an employee has earned for the year and the amount of the tax that he or she has already handed over to the IRS. Usually, employees and the Internal Revenue Service will receive this kind of form from the employers by the January 31st deadline.
To put it simply:
- The W-2 form shows your income earned and taxes withheld from the prior year to be reported on your income tax returns
- The IRS uses it to track the individual's tax obligations
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# 1. Fill Out Box A to Box F
Box a - Employee's social security number
Enter the number shown on the employee's social security card. If the employee does not have a card, he can apply for one by completing Form SS-5. Or if the employee has applied for a card, but the number is not received in time for filling, write "Applied For" in the box on paper forms W-2 filed with SSA. If e-filing enter zeros (000-00-0000)
Box b – Employer identification number (EIN)
Enter the EIN assigned to you by the IRS (xx-xxxxxxx). If you don't have an EIN when filing forms W-2, enter "Applied For" in Box B and don't use your SSN.
Box c – Employer's name, address, and ZIP code
Type the full, legal name you used when you registered your corporation or LLC. Then enter the address of your business, including the zip code.
Box d – Control number
Fill it or leave it blank, and that depends on whether your small business uses control numbers or not.
Box e and f – Employee's name and address
Enter the name as shown on your employee's social security card. If the name does not fit in the space allowed on the form, you can show the first and middle name initials and the full last name.
# Fill Out Box 1 to Box 20
Box 1 – Wages, tips, other compensation
Write the total taxable wages, tips, and other compensation that you paid to your employee during the year. Sometimes the wages you write in Box 1 might be higher or lower than other wages on the W-2 form, so it is not a mistake.
Box 2 – Federal income tax withheld
Enter the total federal income tax withheld from the employee's wages for the year. And it includes the 20% excise tax withheld on excess parachute payments.
Box 3 – Social security wages
Show the total wages paid subject to employee social security tax but not including social security tips and allocated tips.
Box 4 – Social security tax withheld
Show the total employee social security tax withheld, including the social security tax on tips. And for 2021, the amount should not exceed $8,853.60.
Box 5 – Medicare wages and tips
Enter the total Medicare wages and tips in this box. Ensure to enter the tips that the employee reported even if you did not have enough employee funds to collect the Medicare tax for those tips.
Box 7 – Social security tips
Show the tips that the employee reported to you. Make sure that the total of boxes 3 and 7 should not be more than $142,800(the maximum social security wage base for 2021)
Box 8 – Allocated tips
Allocated tips are amounts that you designate to tipped employees, and report the tips in Box 8. Be sure that not all employers have to allocate tips to the employees.
Box 10 – Dependent care benefits
Show the total dependent care benefits under a dependent care assistance program paid or incurred by you for your employees.
Box 11 – Nonqualified plans
Report distributions to an employee from a nonqualified plan or nongovernmental section 457 (b) plan in box 11. And you also need to report these distributions in box 1.
Box 12 – Codes
There are many codes that you need to write in an employee's form W-2. Just complete and code the box for all items.
Note: On Copy A, do not enter more than four items in Box 12.
Box 13 – Checkboxes
There are three boxes: Statutory employee, Retirement plan, and Third-party sick pay. Check any of the three boxes that are relevant to the employee.
Box 14 – Other
You can use this box for any other information that you want to give to your employee.
Box 15 through 20 – State and local income tax information
Use these boxes to report state and local income tax information.
Generally, an employer needs to prepare 6 copies for each W-2 form. The employees will get three copies to file these W-2 forms with their tax returns, and the government will receive two copies for checking. At last, the employer also needs to keep one with the records for 4 years.
As mentioned before, you need to complete six copies, and they will go:
- Send Copy A to the SSA
- Send Copy 1 to the state, city, or local tax department
- Send the Copy B, Copy C, and Copy 2 to the employees
- For the Copy D and the copy of Form W-3 with your records for 4 years
The Bottom Line
The W-2 form is important for both employers and employees. If you are an employer who needs to fill out the W-2 form, you can benefit from this post. Additionally, to help you fill the form better, you can try PDF editing programs like EaseUS PDF Editor to make the task easier and easier!