Procedure for Filling out W2 Forms for Your Employees
Fear of tax penalties drives most people to rush to file their tax returns during the tax season. It is a requirement that every business should file their tax returns at the close of every trading year, so as to be in the government’s good books. Form W2 is one of the forms to be completed by the business owner for their workers. It provides details of employees salaries, amount of tax payable and also any other money deducted from their pay. Anyone whose total earnings per year exceed US$ 600 is supposed to have W2 forms filled for them. The following are the steps to take to complete the W2 form.
Categorise Your Employees
Depending on various considerations, different employees are put into different classes. Part-time or fulltime employment basis, contractual agreement, as well as the salary scale of the employee, are some of the factors affecting this classification. You also need to consider the other benefits enjoyed by the employee such as insurance and tax reliefs, leave and sick pay.
Collect the Relevant Information from Your Employees
You need to collect the appropriate information from your employees once you have sorted them into their respective classes. Employee salary scale, tax payable as well as other benefits and reliefs due to the employee are some of the details you need to have for each staff member. You will also need their names and addresses and also social security numbers. Ensure that you collect this information before you begin the process so that the process will be as smooth as possible.
Look for the W2 and W3 Forms
You can access both the W2 and W3 forms for download at the Internal Revenue Service website. W3 is the accompanying form to W2 which bears the details and records of the employer. To obtain the forms, you only need to register your business on the IRS website. Alternatively, you can check out the social security website and fill out the forms online.
Fill out the W2 Forms with the Right Information
After obtaining the forms and gathering the right information, the next step is to actually fill out the forms. Ensure that you complete the forms as carefully as possible because mistakes made here could have serious consequences. The number of employees you have will determine the number of forms you fill since employee needs a single form.
Give out The W2 Forms
The last step in this process is to have copies of the filled out forms presented to your employee so that they can also file their returns. You are also expected to send another copy of the form to the state department of revenue. It is usually expected that you first print out the forms in the correct hard copy format before you submit them.