W-2: IRS Payroll Tax Form

If you have paid employees, you must prepare IRS payroll tax forms W-2 and W-3 each year.

Your IRS payroll tax form W-2 tells the IRS, the Social Security Administration, and the employee the amount of wages and withholding for the year.

The transmittal form W-3 is the cover page for all the W-2s that will be submitted to the Social Security Administration.

It summarizes the total wages and withholdings included on all the W-2s.

The payroll form W-2 has at least three copies. Copy A has preprinted red boxes and must be submitted to the Social Security Administration along with the W-3.

Copies B and C have preprinted black boxes and are given to the employee.

*Notice: You cannot download a usable W-2 from the web! See the notice at the bottom of the page for instructions.

Your small business should also keep a copy of each W-2s for its records.

When preparing the W-3, it is very important that the totals on the W-3 match the sums of totals on the four Quarterly 941 Forms.

  • Copy B and C of each employee’s W-2 should be postmarked by the end of January.
  • Copy A of all the W-2s and Copy A of the W-3 must be postmarked to the Social Security Administration by the end of January.

The W-2s themselves are relatively easy to fill out. See this Anatomy of a W-2 for explanations of what should go in each box.

Notice that your small business does not, send a copy of the form W-2 and W-3 to the IRS. Instead, the Social Security Administration shares the W-2 and W-3 information with the IRS. So…your business does not have to send copies to both agencies.

You can also file your W-2s and W-3 electronically with the Social Security Administration.

They have a free electronic filing option available that allows you to prepare and submit your W-2s and W-3. The due date for the electronic submission is the end of January as well.

*Notice: You cannot download a usable W-2 and W-3 from the web! The original that’s filed with the IRS is printed in red ink and is read by a scanner. You can order forms from the IRS at no charge, or purchase them from an office supply store. You can reach IRS at 1-800-TAX-FORM to request the ones you need.