Form W-2, Wage and Tax Statement, is a vital resource for determining 2021 taxes and future social security benefits. To avoid burdensome tax penalties and to maximize your tax refund, it is important to review the form carefully.
The American Payroll Association, the nation's leader in payroll education, has five tips to ensure your Form W-2 is accurate this tax season.
1. Request All W-2s. You should receive a Form W-2 from each employer you worked for in 2021. If you do not receive your W-2s by February 5, contact the company's payroll department to request a "reissued statement."
2. Compare Your W-2 to Your Final 2021 Paystub.
Items to review on the W-2:
A. Box 1 will differ from your final 2021 paystub year-to-date gross pay if you participated in a 401(k) or other employer-sponsored savings plan.
B. The Box 3 total should not exceed $142,800 – the 2021 social security wage base.
C. Boxes 1, 3, and 5 will be different from your final 2021 paystub year-to-date gross pay if you used pre-tax dollars to pay insurance premiums, for transit benefits, or to contribute to flexible spending accounts.
3. Check for Tax Credits. Depending on your eligibility, you may qualify for thousands of dollars from the Earned Income Tax Credit. Read the back of the W-2 copy B to determine your eligibility.
4. Verify Any Qualified Leave Wages Are Reported Properly. If you were paid qualified sick leave wages or qualified family leave wages in 2021, these wages must be reported on the W-2, in Box 14, or on a separate statement included with the W-2.
5. Ensure Your Social Security Number (SSN) Matches Your Social Security Card. Double check the social security number on your W-2 matches your social security card. If not, call your employer's payroll department to send a corrected W-2.
If you have any questions regarding your Form W-2 contact your payroll department. For more information, visit APA online at www.americanpayroll.org.