An address is a set of directions for delivery of letters and packages. Use a ten-digit telephone number (801) 555-5555 to enter telephone and fax numbers. Use a typical name@organization.org format to enter the email address.
A department is a section of an organization that handles a particular job or functions in a particular manner. The light blue background means the field is a self-validating field, in other words, you can use the items listed in the drop-down list, or you can add a new item.
An electronic file, or e-file, is a report or document that is sent to a filing agency through the Internet or Email. Use Electronic Filing to set up the properties for filing an electronic W-2 Form.
A 457 Deferred Compensation Plan is a contribution retirement plan for employees of local, state, and federal governments. A 457 Deferred Compensation Plan uses tax-deferred contributions made through a voluntary payroll deduction.
Nonqualified plan section 457 distributions
Enter the non-qualified plan section 457 distributions and contributions.
Nonqualified plan not section 457 distributions
Enter non-qualified plan NOT section 457 distributions and contributions.
Use the options on the States tab to list the state codes for the states that will be filed using an electronic file. The remaining fields on the State subtab are specific to the state code. If additional assistance is required, refer to the State documentation for E-filing.
Add a state
On the Electronic Filing tab > States subtab, click Add a New State.
Remove a state
On the Electronic Filing tab > States subtab, select a state code from the list of States. Click Remove the Selected State.
Change the display order
On the Electronic Filing tab > States subtab, select a state code from the list of States. Click Move the Selected State Up/Down.
Use the options on the U.S. Territories tab to set up electronic filing for Puerto Rico, Virgin Islands, American Samoa, Guam, and Northern Mariana.
The employee number is a unique number that is assigned to the employee.
A name is a word or phrase that constitutes the distinctive designation of a person.
A retirement plan is an option that provides for the retirement of an employee. The Retirement Plan checkbox should be selected if the employee is participating in a qualified retirement plan.
A Social Security number is a unique number assigned to each individual that can work legally in the United States. The employee's nine-digit Social Security number should be displayed in the Social Security Number field.
The Source refers to the application or individual that generated the data in the W-2 Employees database.
"If workers are independent contractors under the common law rules, such workers may nevertheless be treated as employees by statute (statutory employees) for certain employment tax purposes if they fall within any one of the following four categories and meet the three conditions described under Social Security and Medicare taxes" (www.irs.gov).
FICA, an acronym for Federal Income Contribution Act, refers to Social Security and Medicare taxes that employers must deduct from an employee's net pay. An employee who is Subject to FICA pays Social Security and Medicare taxes.
Third party sick pay is a disability insurance benefit that provides employees with partial or full wage benefit payments while on long-term medical leave. The payments are not made through the employer, but through an insurance company, union plan, or state temporary disability plan.
The Third-Party Sick Plan checkbox is selected when the employee is receiving payments from a third party for sick pay.
Use Void to show that there is an error in the file.
"Complete and code this box for all items described below. Note that the codes do not relate to where they should be entered in boxes 12a through 12d on Form W-2. For example, if you are only required to report code D in box 12, you can enter code D and the amount in box 12a of Form W-2. Report in box 12 any items that are listed as codes A through EE" (www.irs.gov).
Add a coded amount
On the Wage Information tab > Coded Amounts subtab, click Add a New Coded Amount. Use the Coded Amount form to select a code. A description for each letter is listed in the section titled Code. Click OK. Then, enter the amount for the coded amount.
Remove a coded amount
On the Wage Information tab > Coded Amounts subtab, click to select the code to remove. Now, click Remove the Selected Coded Amount.
Amount
Enter the amount for the selected code.
Code
When you add a code, use the Coded Amount form to select a code.
Code A—Uncollected social security or RRTA tax on tips.
Code B—Uncollected Medicare tax on tips.
Code C—Taxable cost of group-term life insurance over $50,000.
Codes D through H, S, Y, AA, BB, and EE.
Use these codes to show elective deferrals and designated Roth contributions made to the plans listed. Do not report amounts for other types of plans. See the example for reporting elective deferrals under a section 401(k) plan, later.
Code D—Elective deferrals under section 401(k) cash or deferred arrangement (plan).
Code E—Elective deferrals under a section 403(b) salary reduction agreement.
Code F—Elective deferrals under a section 408(k)(6) salary reduction SEP.
Code G—Elective deferrals and employer contributions (including nonelective deferrals) to any governmental or nongovernmental section 457(b) deferred compensation plan.
Code H—Elective deferrals under section 501(c)(18)(D) tax-exempt organization plan.
Code J—Nontaxable sick pay.
Code K—20% excise tax on excess golden parachute payments (not applicable to Forms W-2AS, W-2GU, or W-2VI).
Code L—Substantiated employee business expense reimbursements.
Code M—Uncollected social security or RRTA tax on taxable cost of group-term life insurance over $50,000 (for former employees).
Code N—Uncollected Medicare tax on taxable cost of group-term life insurance over $50,000 (for former employees).
Code P—Excludable moving expense reimbursements paid directly to employee.
Code Q—Nontaxable combat pay.
Code R—Employer contributions to an Archer MSA.
Code S—Employee salary reduction contributions under a section 408(p) SIMPLE plan.
Code T—Adoption benefits.
Code V—Income from the exercise of nonstatutory stock option(s).
Code W—Employer contributions to a health savings account (HSA).
Code Y—Deferrals under a section 409A nonqualified deferred compensation plan.
Code Z—Income under section 409A on a nonqualified deferred compensation plan.
Code AA—Designated Roth contributions under a section 401(k) plan.
Code BB—Designated Roth contributions under a section 403(b) plan.
Code DD—Cost of employer-sponsored health coverage.
Code EE—Designated Roth contributions under a governmental section 457(b) plan.
The amounts on the General tab that will print in Box 1 through Box 11 on the W-2 Form.
Wages, tips, other compensation (Box 1)
"Show the total taxable wages, tips, and other compensation (before any payroll deductions) that you paid to your employee during the year" (www.irs.gov).
Federal income tax withheld (Box 2)
"Show the total federal income tax withheld from the employee's wages for the year. Include the 20% excise tax withheld on excess parachute payments" (www.irs.gov).
Social Security tax withheld (Box 3)
"Show the total wages paid (before payroll deductions) subject to employee social security tax but not including social security tips and allocated tips. If reporting these amounts in a subsequent year (due to lapse of risk of forfeiture), the amount must be adjusted by any gain or loss" (www.irs.gov).
Medicare tax withheld (Box 6)
"Enter the total employee Medicare tax (not your share) withheld. Include only tax withheld for 2012 wages and tips" (www.irs.gov).
Social Security tips (Box 7)
"Show the tips that the employee reported to you even if you did not have enough employee funds to collect the social security tax for the tips" (www.irs.gov).
Allocated tips (Box 8)
"If you are a food or beverage establishment, show the tips allocated to the employee" (www.irs.gov).
Advance EIC payment
Enter the total paid to the employee as Advance EIC Payments who files a W-3 Form with the employer and who is eligible.
Dependent care benefits (Box 10)
"Show the total dependent care benefits under a dependent care assistance program (section 129) paid or incurred by you for your employee" (www.irs.gov).
Nonqualified plans (Box 11)
"Show distributions to an employee from a nonqualified plan or a nongovernmental section 457(b) plan" (www.irs.gov).
This section is not available when there is only one locality.
Add a locality
On the Wage Information tab > Localities subtab, click Add a New Locality.
Remove a locality
On the Wage Information tab > Localities subtab, select a locality from the Localities list. Click Remove the Selected Locality.
Change the display order
On the Wage Information tab > Localities subtab, select a locality from the Localities list. Click Move the Selected Locality Up/Down.
Income tax
Use the Income Tax field to enter the income tax that is withheld.
Tax type
Select the tax type to apply.
Wages
Use the Wages field to enter the wages, tips, and other compensation before any payroll deductions.
Other descriptions includes any additional information that you want to give to the employee with the W-2 Form. For example, amounts contributed to an employee pension plan, union dues, dependent care assistance paid, health insurance premiums deducted, payroll savings, life insurance, moving expenses paid, and so on. You can also use Other Description to include the employee’s employee number.
Add an other description
On the Wage Information tab > Other Descriptions subtab, click Add a New Other Description. Now, use the Description field to enter the additional information to include on the W-2 Form.
Remove an other description
On the Wage Information tab > Other Descriptions subtab, select an item to delete from the list. Then, click Remove the Selected Other Description.
Change the display order
On the Wage Information tab > Other Descriptions subtab, select an item from the list. Next, click Move the Selected Description Up/Down.
Add a state
On the Wage Information tab > States subtab, click Add a New State. Use the State form to select a state code. Click OK. Now, enter the wages and include income tax for the selected state code.
Remove a state
On the Wage Information tab > States subtab, select a state code from the list of States. Then, click Remove the Selected State.
Change the display order
On the Wage Information tab > States subtab, select a state code from the list of States. Now, click Move the Selected State Up/Down.
Income tax
Use the Income Tax field to enter the state income tax that is withheld.
State
This is the two-character state code for the selected state.
Wages
Use the Wages field to enter the wages, tips, and other compensation before any payroll deductions.
The Year displays the four-digit year of the payroll information that was converted. This is the tax year of the W-2 Form that will be created.