What Is the W-2 Minimum Amount for Employers?

Form W-2, the Wage and Tax Statement, is a document employers must send to each employee and the Social Security Administration (SSA) annually. It reports an employee’s wages and the federal, state, local, Social Security, and Medicare taxes withheld from their paycheck. Employers must provide these forms to employees by January 31 of the following year.

The General Requirement for Employers

For most employment situations, there is no minimum dollar amount of wages that must be earned before an employer is required to issue a Form W-2. The primary rule from the Internal Revenue Service (IRS) is that an employer must file a Form W-2 for any employee from whom they withhold income, Social Security, or Medicare tax. If any of these taxes were taken out of an employee’s pay, a W-2 must be generated, regardless of how little the employee earned.

This rule is often confused with the reporting threshold for independent contractors. Businesses must issue a Form 1099-NEC, Nonemployee Compensation, when they pay an independent contractor $600 or more for services during the year. The distinction is based on control; an employee’s work is controlled by the employer, while an independent contractor controls how their work is done.

If no taxes were withheld from an employee’s pay, the IRS requires a W-2 to be filed if the wages paid were $600 or more. However, because Social Security and Medicare taxes are required on nearly all employee wages, the practical result is that a W-2 is almost always necessary. This makes the no-minimum rule for withheld taxes the most common scenario.

Specific Thresholds for Household Employees

An exception to the general W-2 filing rule exists for those who employ household workers. A household employee is someone who works in or around your private residence, such as a nanny, housekeeper, or gardener. For these employees, a specific dollar threshold determines whether you have employer tax responsibilities.

For the 2025 tax year, if you pay a household employee cash wages of $2,800 or more, you are required to withhold and pay Social Security and Medicare (FICA) taxes. Once this threshold is met, you must provide the employee with a Form W-2. This rule is often called the “nanny tax,” and if you pay a household worker less than this annual amount, you do not have a W-2 filing obligation.

A separate threshold applies to the Federal Unemployment Tax Act (FUTA). If you pay total cash wages of $1,000 or more to all household employees in any calendar quarter, you must pay FUTA tax. This tax is paid by the employer and not withheld from the employee’s wages. The W-2 requirement, however, is tied specifically to the FICA wage threshold, not the FUTA payment amount.

Minimum Amounts for Specific W-2 Box Reporting

While the requirement to issue a Form W-2 is triggered by withheld tax, the information reported in certain boxes has its own rules. The presence of a W-2 does not mean every box will have a value. These reporting requirements are distinct from the obligation to report wages in Box 1.

For example, Box 12 is used to report various types of compensation and benefits, identified by specific codes. Code DD reports the cost of employer-sponsored health coverage. This reporting is for informational purposes only and does not affect the employee’s taxable income.

Box 10 is used for reporting dependent care benefits provided under an assistance program, and its reporting is required regardless of a specific dollar minimum. Similarly, the “Retirement plan” box is checked if the employee was an active participant in a company retirement plan, like a 401(k). This is checked without regard to a specific contribution amount from the employee.

Filing Requirements for Employees

Receiving a Form W-2 does not automatically mean an individual is required to file a federal income tax return. The obligation to file a tax return is determined by gross income, filing status, age, and whether they are claimed as a dependent. These filing thresholds are separate from an employer’s W-2 issuance requirements.

For the 2024 tax year, a single individual under age 65 does not need to file a return unless their gross income is at least $14,600. For a married couple filing jointly where both spouses are under 65, the threshold is $29,200. These income thresholds increase for individuals who are age 65 or older or blind.

There are special circumstances that require filing even if gross income is below the standard thresholds. An individual must file a return if they had net earnings from self-employment of at least $400. Another reason is to receive a refund of withheld income tax; if any federal income tax was withheld, a return must be filed to get that money back.