How to Generate W-2 Forms
Every employer is mandated by the Internal Revenue Service to file a W-2 form for their employees. 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. Nevertheless, if you cannot tell if your worker is an independent contractor or an employee, then you should log into the IRS website and fill the IRS form that determines the status of the individual in your organization.
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.Before you fill the W-2 document, it is vital to have your worker’s pay stub details.Some of the payslip details comprise the name of the worker, his or her ID number, location and the social security number. In addition to that, make sure you have the total income the employee earns and total taxes withheld which include the Social Security taxes, income taxes and Medicare taxes beforehand.
Besides you need to include all the information about your business. You must disclose your organization name and whereabouts as well as your business ID number that is provided to you by the IRS so that they can monitor how much tax your business pays.
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. Here, the parties involved are the SSA, State tax unit, your employee and yourself. The SSA gets Copy A, and the State tax department gets Copy 1, your employee gets Copies B, C and 2 and you must keep Copy D for your record.
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 opt to guess a control number and allocate it to any employee, or you can prepare it automatically.Either way, ensure that the control number contains alphabets and figures. For example, you can opt to have a control number like C1D2.
Keep in mind this information is filled in the boxes provided on the W-2 forms. So, ensure that you follow the instructions given. Moreover, make sure you use a legible black font when filling these forms.
After you fill the W-2 document, the next form you should fill is the W-3 form that confirms that the information you recorded on the W-2 form is correct. You must submit the form W-3 together with W-2 to the SSA. Filling the W-3 form will not be a hard task as it virtually contains the same data in the W-2 form.Lastly, from the IRS website, make sure you print out the W-2 and W-3 Forms.