What kind of employer

For example, use the version for reporting taxes, even though you may be working on the form in Information about the employer is entered in boxes A through H. Box a. Optional control number you can use for your own business purposes. Box b. Kind of Payer. Most businesses check the box labeled "" for "Kind of Payer".

The form is the quarterly wage and tax report form completed by most employers. Other options include a household employer and others. Kind of employer. Most for-profit businesses check the "none apply" box for "Kind of Employer". The other boxes are for non-profit organizations and federal government employers. Box c Total number of Forms W Add up the number of W-2 forms you are submitting. Box d Establishment number helps employers identify different areas of their businesses either by location, subsidiary , or division.

For example, you might want to separate out the W-2 forms for different states where employees work. You must separate out W-2 and W-3 forms for each establishment if you identify establishment numbers in this section, or you can combine all your establishments and submit all W-2 forms together along with one W-3 form.

The amounts on other employment tax reports, including Form and Form , must agree with amounts reported on Form W The items in the second section boxes 1 through 19 are the same for both the W-2 and W In the W-3 form, you must give totals for all boxes for all employees. The final part of the form requires that you provide your contact information, including an email address. The filing address for paper forms W-2 and W-3 is:.

The totals for each item on the W-3 must equal the totals for all these items on all employee W-2 forms. The W-2 and W-3 also include total state wages and withholding for all employees. The SSA encourages you to e-file W-2 forms. If your employer doesn't use control numbers, box d will be blank. Boxes e and f. These appear as one big block on your form W Your full name is reported at box e.

It's supposed to reflect the name that's actually on your Social Security card the SSA isn't crazy about suffixes, even if you use them, so you shouldn't see one on your form W-2 unless it's on your Social Security card.

If your name isn't exactly as it appears on your Social Security card, you may need a new form W-2; ask your employer if you're not sure. Your address is reported at box f and should reflect your mailing address - which could be a post office box - likely without punctuation a USPS preference.

If your address on the form W-2 isn't correct, notify your employer: you won't need a new form W-2 but your employer needs to update his or her records. The boxes you care most about are those boxes a , e and f , as highlighted by the pink circles:. Box 1 shows your total taxable wages, tips, prizes and other compensation, as well as any taxable fringe benefits.

It does not include elective deferrals to retirement plans, pretax benefits or payroll deductions. Since the figure highlighted by the red arrow in my example below doesn't include those amounts, it's not unusual for this amount to be less than the amounts included at boxes 2 and 3. It's the number most taxpayers care about the most.

Box 2 reports the total amount of federal income taxes withheld from your pay during the year. This amount highlighted by the purple arrow in my example below is determined by the elections on your form W-4 based on exemptions and any additional withholding.

If you find that this number is too low or too high, you'll want to make an adjustment on your form W-4 for the next year. Box 3 shows your total wages subject to the Social Security tax. This figure is calculated before any payroll deductions which means that the amount in box 3 could be higher than the number reported in box 1, as in my example.

It could also be less than the amount in box 1, if you're a high-wage earner, since the total of boxes 3 and 7 see below cannot exceed the maximum Social Security wage base. If you have more than one job, for Social Security tax purposes, the cap still applies.

Box 4 shows the total of Social Security taxes withheld for the year. Unlike federal income taxes, Social Security taxes are calculated based on a flat rate.

The rate is 6. The amount in Box 4 should, then, be equal to the amount in box 3 times 6. Since you should not have more Social Security withholding than the maximum wage base times 6. Box 5 indicates wages subject to Medicare taxes. Medicare taxes generally do not include any pretax deductions and will include most taxable benefits.

That, combined with the fact that unlike Social Security wages, there is no cap for Medicare taxes, means that the figure in box 5 may be larger than the amounts shown in box 1 or box 3. In fact, it's likely the largest number on your form W Box 6 shows the amount of Medicare taxes withheld for the year. Like Social Security taxes, Medicare taxes are figured based on a flat rate.

The rate is 1. For most taxpayers, this means that the figure in box 6 is equal to the figure in box 5 times 1. However, under a new law that kicked in beginning in , an employer must withhold additional Medicare tax of. Since your employer doesn't know your entire financial picture, it's possible under the new law that you may have to pay more additional Medicare taxes than your withholding depending on filing status, compensation and self-employment income.

Tips which were reported to your employer will be found in box 7. If this box is blank, it means that you did not report tips to your employer this doesn't mean that you don't have to report those tips to IRS. Allocated tips reported in box 8 are those that your employer has figured are attributable to you. Those tips are considered income to you. There won't be anything in box 9. The reporting requirement for that box expired a few years ago and the box hasn't yet been removed from the form go figure.

At box 10 , your employer will report the total of any benefits paid on your behalf under a dependent care assistance program. Box 11 is used to report amounts which have been distributed to you from your employer's non-qualified deferred compensation plan this amount is taxable. Generally speaking, if the entity or individual paying you directs when, where, and how you work, you may be an employee.

If you're working as a contractor but think you're misclassified, contact the federal Department of Labor , state labor department, or a local employment attorney for assistance and advice. When employers hire employees, they are classified as either exempt or nonexempt.

Exempt employees receive a salary for completing a whole job. To be classified as exempt, employees must meet standards that involve more than just receiving a salary rather than hourly pay; it also involves the type of work done by the employee.

There are exemptions for executive, administrative, professional, computer, and outside sales employees. Exempt employees receive the same salary each pay period regardless of the number of hours they worked. Employers can't dock the wages of an exempt employee who goes home early, for instance. Employers can also hire employees as nonexempt or hourly workers who are paid an hourly wage for each hour worked, and whose pay is subject to the terms of the Fair Labor Standards Act FLSA for overtime.

These employees must be paid for every hour worked. For instance, if employees are scheduled to work from a. If the employee works through lunch, they receive 9 hours of pay. Employees typically work under a verbal, implied, or written contract. Some employers use job offer letters to confirm the details of an employment relationship. In union-represented workplaces, the employer is obligated to follow the terms of the union-negotiated contract. Unless there is a specific contract in place, employees in 49 of the 50 states are employed at-will.

Montana is the only exception, as it has eliminated the at-will rule. This means employees can quit at any time and the employer can fire them at any time for any reason. Employees typically give two weeks' notice when they resign. Two weeks' notice may not be required or even recommended, though, depending on the nature of the work and the employer.

Some employment contracts specify the amount of notice employees are required to give. Companies usually terminate employment for a reason, such as poor performance or position elimination, but legally they aren't required to have a reason because of at-will employment.