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Ways to Prepare a W-2 Form

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It is important to note that employees are supposed to receive a form that indicates the total wages and all the deductions and use the information when filing income tax returns. The form that the employees receive is referred to as the W-2 form. There is a need for employers to know how to prepare the W-2 form to avoid making mistakes. It will be easier for you to prepare the W-2 form if you follow the tips below.

The first step towards filling the right information in the W-2 form is to ensure that you know your employees and your independent contractors. You should note that the IRS requires you to classify workers as employees, no matter how hard it may be to tell the difference between employees and independent contractors. There would be fines and penalties if you do not make the classification. An employee is supposed to follow the rule and guidelines of the company that he or she works for. On the other hand, an independent contractor is a separate entity and cannot be termed as an employee. You can work with an employment attorney to help you with the classifications or visit the relevant websites.

You should collect payroll information for the forms. There is a need for you to indicate the employer ID number of the company.

Moreover, you should not forget the state tax identification number of your company. Then, the name and address of the business. After that, you should have information on all employees. You should not proceed without indicating the names and address of all your employees. You should also know the amount of salary each employee gets. If you indicate the social security wage, it would be easier for you to prepare the W-2 form. It is necessary to know the income tax withheld, together with the local wages and tips, check out and see page now!

You can review the company's payroll process. The fact that the company is new to payroll processes means that you have to review the process in order to be conversant. You need to review the payroll process especially if there have been some changes. Reviewing at this article will enable you to know the process of completing and distributing the reports to the employees. You should ensure that you look for the accounting software to help you prepare the W-2 forms.

You would not experience any problem if you use the tax preparation software. You should look for ways to distribute the W-2 forms to the employees so that they can use them when filing returns. You can also click this website for more facts about pay stub, visit http://www.ehow.com/how_5700982_make-employee-pay-stub.html.