What IRS Form W-2 (2020) Is For
Employers issue IRS Form W-2, also called the Wage and Tax Statement, to report wages, taxable wages, federal income tax withheld, and other required year-end information. The form enables employees to review gross income, Social Security wages, Medicare wages, and federal tax responsibilities. The Social Security Administration uses the reported figures to maintain accurate earnings records and confirm that taxable wages and Medicare tax amounts are recorded correctly.
Employers must provide the form early in the calendar year to follow federal reporting rules. Employees should review each entry thoroughly because accurate information influences refunds, balances due, and overall filing results. Employees should also verify any codes that affect reporting and ensure that all details appear complete before submitting returns.
Additional guidance on wage reporting appears in our Payroll & Employment Tax Forms section.
When You’d Use IRS Form W-2 (2020)
Employees use the form during tax return preparation because it lists federal income tax withheld, Social Security wages, Medicare wages, and state wages. Each employee relies on W-2 wage entries to determine income, total amounts paid, and amounts owed under federal law. Representatives use the information to confirm employer records.
An employee uses the form to verify personal details because accurate entries support correct reporting. The form helps workers compare earnings from multiple jobs during the year. Employees keep a copy for future needs and record any eligible items.
Timely use of the form supports accurate filing because complete entries prevent issues. The information helps employees prepare documents for questions about wage data.
Key Rules or Details for 2020
Employers must follow 2020 reporting rules that cover taxable wages, Social Security wages, Medicare wages, and employer-sponsored health coverage. The form may list contributions to a deferred compensation plan, pension amounts, expenses, interest entries, and health insurance costs. Employees must confirm Social Security numbers and the total amount reported because every correction affects tax calculations.
The 2020 tax year allowed truncated Social Security numbers on employee copies of the form. Employers still needed to report the full number to the Social Security Administration so the agency could update earnings records. Each employer also needed to follow federal income tax reporting requirements for all wages paid.
Employers must maintain payment records, and employees should review all entries. This process helps prevent potential penalties.
Step-by-Step (High Level)
Step 1: Employees obtain IRS Form W-2 (2020) through mail or secure online access. Employees review Social Security wages, Medicare wages, taxable wages, and federal income tax withheld for accuracy. Employees contact the employer when wage and tax information appears incomplete or clearly incorrect.
Step 2: Employers calculate wages, tips, cash payments, and contributions that qualify as taxable wages. Employers complete each Wage and Tax Statement, verify Social Security numbers, and prepare data for filing. Employers submit forms to the Social Security Administration and provide employees with copies for tax returns.
Step 3: Employees request corrections when any wage entry or tax figure appears incorrect. Employees use paycheck records to support each corrected form request. Employers file corrections to keep records accurate.
Common Mistakes and How to Avoid Them
Many taxpayers experience delays when IRS Form W-2 submissions contain preventable reporting mistakes. These errors disrupt IRS and SSA wage matching and require additional verification. A clear review of the issues strengthens compliance and supports accurate record updates. Thorough preparation by the employer limits follow-up requests from federal agencies.
- Incorrect Social Security numbers: This mistake occurs when employers record a number that does not match the employee’s official SSA document. Employers avoid this error when they verify the number against the employee’s record before filing.
- Mismatched Employer Identification Numbers: This mistake appears when the EIN on the form differs from the EIN used on payroll reports. Employers prevent this issue when they confirm the correct number across all filings.
- Misstated Taxable Wages: This mistake occurs when payroll systems include or exclude items incorrectly. Employers avoid discrepancies when they compare wage summaries with year-end payroll registers.
- Omitted Employer-Sponsored Health Coverage Codes: This mistake appears when required coverage amounts do not show in the designated box. Employers prevent this omission when they review benefit records before generating the form.
- Incorrect Withholding Totals: This mistake occurs when the federal income tax withheld does not match payroll system reports. Employers avoid this error when they reconcile withholding registers with reported totals.
What Happens After You File
The IRS receives each tax return and matches the wage and tax information with the employer’s reported data. The Social Security Administration updates the employee’s earnings record using Social Security wages and Medicare wages. Accurate reporting supports proper benefit calculations for future claims.
The IRS may request additional information when differences appear in taxable wages or withheld amounts. Employers may need to file corrected forms to update state wages, federal income tax withheld, and other reported wage fields. Employees should keep copies of all forms to support later verification efforts.
Employees receive refunds when withheld amounts exceed tax obligations for the tax year. Employees pay the remaining balances when the amounts shown do not cover the required liability.
For more IRS filing support and form guidance, visit our IRS Form Help Center.
FAQs
Do I receive a separate form when employers report Social Security wages and Medicare wages for different jobs?
Each employer must issue a separate form because each employer reports Social Security wages, Medicare wages, taxable wages, and federal income tax withheld for the tax year. Taxpayers should keep every form so the income tax return reflects all earnings. Accurate reporting helps avoid delays or additional requests for information.
Why does the federal income tax withheld amount differ from the gross income on my paycheck records?
Box 1 excludes pre-tax entries such as health insurance costs or deferred compensation plan contributions. Paycheck records show gross income, which includes all earnings before adjustments. The difference ensures the correct taxable wages appear on the income tax return.
What should a taxpayer do when an employer cannot provide wage and tax information needed to report wages?
The taxpayer should contact the employer first because the employer maintains wage and tax information for the tax year. If the taxpayer cannot obtain the form, the taxpayer may contact the IRS for further instructions. The taxpayer may need paycheck records to sign and file a timely return.
Can a taxpayer file an income tax return without state wages, Social Security wages, or Medicare wages from the form?
The taxpayer should wait for the form because the document reports state wages, Social Security wages, Medicare wages, and taxable wages. Filing without the form increases the likelihood that entries will be incorrect. The IRS may request corrected information later.
What happens when a taxpayer receives a corrected form that changes the federal income tax withheld or Medicare tax amounts?
The taxpayer should compare all corrected entries with the original form. A corrected form may update federal income tax withheld, Medicare tax, or taxable wages. The taxpayer may need to file an amended income tax return if the corrected numbers change the calculation.
