How to Check If Your W-2 Is Correct and What to Do
Proactively confirm your W-2's accuracy to prevent tax issues. Learn how to verify this vital document and resolve any discrepancies for smooth filing.
A Form W-2, the Wage and Tax Statement, is an Internal Revenue Service (IRS) tax form employers must issue to each employee by January 31st each year. This document details total wages paid and federal, state, and local taxes withheld from pay during the calendar year. The IRS receives a copy of each W-2, allowing them to cross-reference income and withholding information reported by employers and employees.
The accuracy of your W-2 is important because it directly impacts your tax refund or the amount you owe. Discrepancies can lead to delays in processing your refund, IRS inquiries, or penalties for incorrect reporting. Reviewing your W-2 for accuracy before filing your taxes helps prevent potential issues.
Key Information on Your W-2
Your W-2 form contains boxes reporting specific financial details from your employment. Box 1, “Wages, tips, other compensation,” shows your total taxable wages, including tips and other compensation. This amount does not include pre-tax deductions like contributions to a 401(k) retirement plan or health savings accounts.
Box 2, “Federal income tax withheld,” indicates the total federal income tax your employer deducted from your paychecks. This amount is remitted to the IRS on your behalf. Boxes 3 and 5 report “Social Security wages” and “Medicare wages and tips,” representing earnings subject to these taxes.
Boxes 4 and 6 show the actual “Social Security tax withheld” and “Medicare tax withheld.” Box 12 provides codes and amounts for various types of compensation or benefits, such as contributions to a 401(k) (code D) or health savings account (code W).
The lower portion of the W-2 addresses state and local tax information. Box 16, “State wages, tips, etc.,” reflects wages subject to state income tax. Box 17, “State income tax withheld,” shows total state income tax deducted. Similarly, Box 18, “Local wages, tips, etc.,” and Box 19, “Local income tax withheld,” report wages and taxes related to local taxation, if applicable.
Verifying W-2 Details
After receiving your W-2, compare its details against your personal records. Gather your last pay stub of the year, which shows year-to-date (YTD) totals for earnings and deductions. Compare the YTD gross wages on your pay stub to the amount in Box 1 of your W-2.
Next, cross-reference the YTD federal income tax withheld from your pay stub with Box 2 on your W-2. Also compare the YTD Social Security wages and tax withheld from your final pay stub to Boxes 3 and 4, respectively, on the W-2. Similarly, verify the YTD Medicare wages and tax withheld against Boxes 5 and 6.
Pay close attention to your personal information on the W-2, ensuring your name, address, and Social Security number (SSN) are accurate. Your name should match what is on file with the Social Security Administration. Also, confirm the employer’s name, address, and Employer Identification Number (EIN) are correctly stated.
Finally, review Box 12 for any codes and associated amounts, comparing them to your records of pre-tax deductions or benefits received. Any discrepancies should be addressed promptly.
Steps to Correct an Incorrect W-2
If you discover an error on your W-2, contact your employer’s payroll or human resources department. Explain the discrepancy and request a corrected W-2 form, known as a Form W-2c. Employers have processes in place to handle such corrections.
If your employer is unresponsive or unwilling to issue a corrected W-2 after a reasonable amount of time, contact the IRS for assistance. The IRS may then contact your employer on your behalf.
If the tax deadline approaches and you still haven’t received a corrected W-2, you have options for filing your taxes. You can file Form 4852, “Substitute for Form W-2, Wage and Tax Statement, or Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.,” with your tax return. This form requires you to estimate your wages and withheld taxes based on your records, and explain your efforts to obtain a correct W-2.
Alternatively, you could file an extension using Form 4868, “Application for Automatic Extension of Time to File U.S. Individual Income Tax Return,” which grants an automatic six-month extension to file your return. If you file your return with an incorrect W-2 and later receive a corrected one, you may need to file an amended tax return using Form 1040-X, “Amended U.S. Individual Income Tax Return,” to report the accurate figures.