An incorrect W2 can create serious problems for you. You may think that it is your employer’s problem but think again. If you have received an incorrect W2, there are actions that you must take to resolve the situation. If you have to create your own, a W2 generator can help.
It occurs more frequently than you may think: you receive your W2 and prepare to file your taxes, only to discover that the wages shown on it appear to be incorrect. You double-check your records and discover that the information is wrong. You must correct the problem as soon as possible because the time for submitting taxes is approaching. You have a few alternatives, and the rules and procedures are quite straightforward.
What Is a W2?
Any employer that pays an employee more than $600 must provide a W2 for each employee. A W2 includes the following information.
- Income – including wages, bonuses, and non cash payments
- Taxes – including social security, Medicare, and income tax
The amount of each tax withheld from your check will depend on how much money you make and your designated withholdings.
What should you do if you don’t receive your W2 before January 31 or if it has incorrect information? Some companies have bad bookkeeping, or your company may have gone out of business or been bought by another company. If you relocated, your employer may not be aware of your new address. You should follow the IRS’s three-step process.
What to Do If you Receive an Incorrect W2
The first thing to do is take action. Even if you think the error is small. Errors can lead to an IRS audit, tax penalties and fines, and even jail time. If you have verified that your records and your employer’s are different, the first step is to contact your employer and request a new W2.
When contacting your employer, it is best to start with the human resources department to address this issue. A small difference may be due to a simple end of year tax adjustment. In this case, you do not need to worry about it. However, if there is a big difference your employer can quickly issue a new W2. This form will be labeled as a W-2c to indicate that it is a corrected form. If you get a W-2C, make sure you double-check that information as well.
Contact Your Boss
Check to see if the information on your W2 is indeed incorrect. The numbers presented may change somewhat from the amounts recorded on your last pay stub of the year. The W2 form may contain changes to taxable income or tax-free advantages. If you have found any problems, the first step is to notify your employer (or their HR/payroll department) and request that they provide you a new, proper W2 form before the end of February.
When you get a correct W2 and file your taxes online, you update the original Form W2 information you supplied. If you file online, you do not need to transmit the W2C form since the IRS will get a copy from your employer. Make sure you enter the right Form W2C information and then proceed with the tax return as usual.
What If Your Employer Won’t Respond
If you run into the case where an employer refuses to answer your questions, continuously issues the wrong W2, or straight refuses to issue a new W2, you need to contact the IRS. Contacting the IRS will generate a claim and protect you from prosecution, holding the employer responsible. When contacting the IRS, you will need the following information:
- Social Security number
- Income that you believe to be correct
- Contact information of your employer
Once they receive this information, they will contact your employer directly and request a W-2c.
Contact the Internal Revenue Service.
If you get an incorrect W2 or you are worried that your employer is unlawfully withholding or failing to withhold federal income and employment taxes, contact the IRS for assistance. The IRS will conduct its own research.
You can contact a Taxpayer Assistance Center or call 1-800-829-1040. The IRS will send a letter to your employer directing them to release a rectified version within 10 days.
You can submit your tax return using Form 4852, the “Substitute for Form W2,” to report what you believe is the right amount of earnings and withholding, and the IRS will inform you of this option if you contact them. If you utilize this form, you must provide your pay stubs.
When contacting the IRS, make sure you have not only your taxpayer information, but also your employer’s or payer’s name, complete address (including ZIP code), employer identification number (EIN), and phone number.
If Bankruptcy Is the Problem
If your employer has gone bankrupt or out of business, there may be another solution. According to the IRS, it is occasionally feasible for an employee to follow up directly with the bankruptcy court in this circumstance. Instead of the employee needing to utilize Form 4852.4, the bankruptcy trustee may be able to give a revised incorrect W2.
If you are in this circumstance, contact the bankruptcy court in your region. Ask how you might contact the trustee managing your old employer’s bankruptcy case, then reach out and explain your situation.
Other Information Problems
Incorrect W2 are not restricted to income and withholding issues. Your name’s spelling, a name change due to marriage or divorce, your address, or your Social Security number (SSN) may also be incorrect, although this is normally a much easier remedy.
It should be straightforward to request that your employer alter your name or SSN, however you will most likely be required to submit evidence of your number.
In terms of a bad address—perhaps you’ve relocated since beginning employment for this business and forgot to update your information with the company—this is usually a simple problem to resolve. You may include the W2 with your tax return as long as your exact and current address is listed on Form 1040. However, you should notify your employer of the change.
IRS Form 4852 serves as a replacement W2 that allows you to file your taxes. Once you file a claim, the IRS will send you this form with instructions. All you have to do is fill it out along with your tax return.
Most W2 mistakes are not intentional, mistakes do happen. Sometimes it is simply due to small businesses not having the resources or knowledge to correctly withhold taxes. Make your life easier and use PAYSTUBSNOW to avoid inaccurate information and problems down the road.
What if I get a revised W2 after filing my taxes using Form 4852?
You are not required to do anything if the updated W2 and Form 4852 include the same information. If the corrected W2 differs from the Form 4852, you must file a Form 1040-X amended return with the revised W2.