Is My W2 Wrong? How to Find and Correct Any Errors

A Form W-2, Wage and Tax Statement, reports an employee’s annual wages and taxes withheld. It provides the Internal Revenue Service (IRS) with information about your earnings and tax contributions. An accurate W-2 is important for preparing a correct tax return, as errors can lead to IRS issues, affect your refund, or alter your tax liability.

Identifying Potential W-2 Errors

Errors on a W-2 form can affect various pieces of information. Personal details like your name may be misspelled or not reflect a recent legal name change. Your Social Security Number (SSN) is critical and must be correct; an incorrect SSN can cause processing delays with the IRS.

Wage and tax withholding errors are common in the boxes detailing compensation and taxes. Box 1 reports taxable wages, tips, and other compensation, while Box 2 shows federal income tax withheld. Box 3 and Box 5 detail Social Security and Medicare wages, with Box 4 and Box 6 showing the corresponding taxes withheld. Discrepancies in these amounts can significantly impact your tax outcome.

Errors can also occur in the employer’s information, including an incorrect Employer Identification Number (EIN) or an inaccurate employer name or address. These errors can still cause processing issues. Other boxes on the W-2 might contain mistakes, such as Box 10 for dependent care benefits, or Box 12, reporting benefits such as health savings account contributions or deferred compensation. Box 13 indicates if you are a statutory employee, participated in a retirement plan, or received third-party sick pay. These indicators can also be incorrect.

State and local tax information, found in Boxes 15 through 20, can also contain errors. This includes incorrect state or local wages or the wrong amount of state or local income tax withheld. Each of these potential inaccuracies can lead to problems when you prepare and file your annual tax return.

Steps to Verify Your W-2 Information

You can take specific steps to verify the accuracy of your W-2 information before preparing your tax return. A primary method involves comparing the figures on your W-2 to the year-to-date (YTD) totals on your final pay stub. This comparison is particularly important for Boxes 1-6, which detail your wages and federal tax withholdings. You should also check the state and local tax amounts in Boxes 15-20 against your final pay stub.

Beyond pay stubs, reviewing other financial records can help confirm the W-2’s accuracy. For instance, check bank statements to reconcile direct deposits with your reported wages. If you contributed to pre-tax accounts, such as a 401(k) or a Health Savings Account (HSA), verify that these contributions are correctly reflected in Box 12 of your W-2.

It is also helpful to compare your current W-2 with the previous year’s W-2. This comparison allows you to quickly spot any inconsistencies in basic information like your name, Social Security Number, or the employer’s EIN. Taking these verification steps helps ensure that the information on your W-2 is precise before you proceed with tax filing.

Process for Correcting an Incorrect W-2

If you identify an error on your W-2, the first step is to contact your employer’s payroll or human resources department. Clearly explain the discrepancy, providing details such as the incorrect amount or misspelled name. It is helpful to have supporting documentation, such as your final pay stub, ready to substantiate your claim.

Your employer is responsible for issuing a corrected W-2, which is known as Form W-2c, Corrected Wage and Tax Statement. This form indicates the corrections made to your original W-2. The W-2c will show the previously reported incorrect figures and the newly corrected amounts, making it clear what changes were applied.

If your employer is unresponsive or unable to provide a corrected W-2, you have recourse through the IRS. You can contact the IRS for assistance, particularly if the tax filing deadline is approaching and you still lack a correct W-2. The IRS may advise you to file Form 4852, Substitute for Form W-2, Wage and Tax Statement, if you did not receive a W-2, or if the one you received is incorrect and your employer will not provide a corrected version. This form allows you to estimate your wages and withholdings.

Impact on Your Tax Filing

An incorrect W-2 can significantly impact your tax preparation and filing process. If the error is substantial, it is advisable to wait for your employer to issue a corrected W-2c before filing your tax return. To avoid penalties for late filing, you can file an extension using Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, which grants an additional six months to file.

Filing your tax return with a known incorrect W-2 carries risks, including receiving notices from the IRS or delays in your refund. While it might seem necessary if the tax deadline is imminent and a W-2c has not arrived, it often leads to further complications. The IRS’s records, based on your employer’s submission, will not match your return, which can trigger an inquiry.

Once you receive a corrected W-2c, if you have already filed your original tax return, you will need to amend it. This is done using Form 1040-X, Amended U.S. Individual Tax Return. Amending your return allows you to correct your tax liability, receive any additional refund you are owed, or pay any additional taxes due. Failing to correct W-2 errors can result in delayed refunds, unexpected tax bills, or correspondence from the IRS regarding discrepancies.