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How to Create W-2 Forms

The Internal Revenue Service mandates every business owner to create a W-2 form for their staff members.When preparing this document, they must indicate the amount of money the worker received as well as the amount of money that was deducted from their wages.

So, if you want to create a W-2 form, it is essential to know the status of your employee whether he or she is an independent contractor or is a permanent employee to keep your business out of trouble. Nonetheless, if you are unsure whether your worker is an employee or a freelancer, you do not have to worry as the IRS site will guide you in determining the worker’s status once you fill an IRS form.

As soon as you identify which category your worker belongs to, the other thing you ought to do is to visit the IRS website so that you can request for the W-2 form.Ensure that you have your worker’s payslip details before you start filling the W-2 form. This includes the name, ID number, address and the social security number of the employee. More so, ensure you obtain the employee’s total income wages, Social Security wages, Medicare wages and any other tax deducted from the employee.

Apart from having the employees’ details, you also need to have your employers’ details at hand. Some of the information you are required to fill on the W-2 form comprises of the enterprise name and location in addition to the enterprise identification number which is given to you by the IRS so that they can recognize your enterprise for taxation reasons.

Once you have that information, the next thing you need to do is to fill the six forms attached to the W-2 form which you must submit to all the parties involved. The individuals who receive these forms include the SSA, State tax office, your worker and the organization itself.The copies are distributed as follow; Copy A goes to SSA, Copy 1 goes to the City tax unit, Copies B, C and two are given to the worker, and Copy D is for the business.

But before you fill these forms, make sure you generate a control number for your employee. This control number will help you in differentiating different employees as each employee has a unique control number when you are filling the six forms. You can assign a control number to each employee by yourself or your payslip preparation software can create this number electronically. In any case, be sure to include scripts and symbols in your control numbers.For example, you can opt to have a control number like C1D2.

Remember that the W-2 requires you to fill all these facts in the correct spaces provided. For that reason, make sure that you read the W-2 form carefully before you start filling it. Furthermore, for legibility purposes make sure you fill the form using a black pen.

Once you are through with filling the W-2 form, you need to fill Form W-3 which supports the information on the W-2 form. You must submit the form W-3 together with W-2 to the SSA. Form W-3 contains the same information as W-2, so it is not difficult to complete. Once you through filling these documents, the last thing you should do is to print out copies of W-2 and W-3 forms on the IRS site.

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