What Is the Locality Name on a W-2 Form?

A W-2 form is a key document for tax filing, summarizing an individual’s annual earnings and the taxes withheld from their pay. It contains various boxes, each holding specific financial information. Understanding these details is important for accurate tax reporting.

What Box 20 Means

Box 20 on your Form W-2 identifies the “Locality Name,” which relates to the local income tax amount reported in Box 19, “Local income tax.” This box specifies the city, county, school district, or other local governmental unit to which the local income tax was paid.

Local income taxes are distinct from federal and state income taxes and are not universally imposed across the United States. If your employer withheld local income taxes, both Box 19 and Box 20 will contain information. If no local income taxes were withheld, both boxes will typically appear blank.

How Your Locality is Determined

Employers determine the locality for Box 20 based on where an employee performs their work. Many local income taxes apply to income earned within that specific jurisdiction. Thus, the primary factor for determining the locality is often the employee’s work location.

When an employee lives in one locality but commutes to work in another, local tax rules often dictate that the tax applies to income earned in the work locality. This means the locality on your W-2 typically reflects where your services were rendered, even if your home address is different. For remote employees, locality determination can be more complex, potentially based on the employer’s location, the employee’s home address, or specific multi-state or local tax agreements. Local tax laws vary significantly, even within states, making accurate determination important for compliance.

What to Do About Errors

If you believe the “locality name” in Box 20 on your W-2 form is incorrect, missing when it should be present, or present when it should be blank, you should take specific steps to address the discrepancy. Begin by reviewing your pay stubs throughout the year. This review allows you to verify if local tax withholdings were indeed taken and to confirm the associated locality listed on those pay records.

After checking your pay stubs, the next step is to contact your employer’s payroll or human resources department to discuss the potential error. Provide them with the details of the discrepancy you observed. If an error is confirmed, your employer is responsible for issuing a corrected W-2, known as Form W-2c.

Having an accurate W-2 is important for filing your tax return correctly. Using an incorrect W-2 could lead to complications, such as needing to file an amended tax return later. Employers typically issue corrected W-2c forms within a reasonable timeframe, often within a few weeks of the request, to help ensure timely and accurate tax filing for their employees.