The Internal Revenue Service wants employers to know the clock is ticking, and to get their Forms W-2 and other wage statements to the government very soon. The deadline is January 31.
As of 2015, employers are required by law to get their Forms W-2, Wage and Tax Statements, and Form W-3, Transmittal of Wage and Tax Statements, transmitted to the Social Security Administration by the end of January. Filing these documents ahead of the deadline helps employers avoid penalties while also helping the IRS to prevent fraud.
The employers’ deadline coincides with their deadline to get Forms W-2 into the hands of their workers by January 31, along with any Forms 1099-MISC, Miscellaneous Information, and Forms 1099-NEC, Non-Employee Compensation.
Various other due dates related to these two forms—as well as the dates forms are due at the IRS—are available in the Form 1099 instructions on the IRS website.
Keeping the lid on fraud
When employers file their W-2s and W-3s ahead of the deadline, it gives the IRS more time to detect fraud by verifying the reported income on tax returns. Early filing employers win in two ways: They avoid penalties while helping the fight against fraud.
E-filing is the preferred method of transmitting the needed forms, according to the IRS and the SSA, offering a quick, accurate and convenient method to file. More information about the W-2 filing process can be found on the SSA’s Employer W-2 Filing Instructions & Information website at SSA.gov/employer.
File timely, but file correctly
While keeping the January 31 deadline in mind, employers should also, however, understand the need to file an accurate wage statement.
The Employer Identification Number (EIN) on wage and tax statements, such as forms W-2 and W-3 for example, and on their payroll tax returns have to match the EIN assigned by the IRS to their business.
Employers should not use their Social Security number or Individual Taxpayer Identification Number (ITIN) on any form that asks for an EIN.
Sometimes, such a mismatch seems warranted. When that’s the case – let’s say an employer used an EIN on payroll tax returns different from the EIN used on their W-3 due to a change in ownership – they need to check out General Instructions for Forms W-2 and W-3. On that page, see Box H – “Other EIN used this year.”
When employers use inconsistent EINs – or use another employer’s EIN – on these filings, the result could be penalties and delays in processing the filing employer’s returns.
The IRS says the name and EIN on all statements and forms that are filed have to be consistent and match the EIN assigned to the business exactly. This applies even if an employer uses a third party payer or a different entity within their business to file the forms.
Publication 15, Employer’s Tax Guide, has more information on such third-party situations.
Extensions are available
Form 8809, Application for Extension of Time to File Information Returns, can be used by employers to request a 30-day extension to file their Forms W-2. Form 8809 has to be filed by the original January 31 deadline.
But there’s a catch.
An extension does give the employer more time to get the filing to the IRS. It does not, however, give more time to get wage statements to their employees. The employees still must receive their wage statements by January 31.
For more information on extensions, see Extension of time to furnish Forms W-2 to employees.
Need even more information? The instructions for Forms W-2 & W-3 and the Information Return Penalties page on the IRS website have it.
Source: IR-2022-15