Form W-2 (2010) Checklist
Purpose and Reporting Scope
Form W-2 reports 2010 wages, federal, state, and local tax withholding, Social Security and Medicare taxes withheld, and advance Earned Income Credit payments. HIRE Act-exempt wages under code CC must be separately tracked and reported in box 12 for employers who hired unemployed workers.
Employee Information and Wage Reporting
Identity Verification
- Verify employee name, address, and Social Security number match SSA records exactly.
- Report corrections via Form W-2c if any discrepancy exists between the employee's card and your records.
Box 1 Total Compensation
- Enter total 2010 wages, tips, and compensation in box 1, including noncash fringe benefits and taxable moving expense reimbursements.
- Exclude only nontaxable items listed in the 2010 instructions.
Federal Income Tax Withholding
- Calculate and enter federal income tax withheld in box 2 using 2010 tax tables and withholding allowances claimed on Form W-4.
- Withholding must reflect changes in filing status or allowances made during 2010.
Social Security and Medicare Tax Reporting
Social Security Wages and Tax
- Report Social Security wages in box 3 up to the 2010 wage base limit of $106,800.
- Do not exceed this ceiling regardless of actual compensation earned.
- Compute Social Security tax withheld in box 4 at the 2010 employee rate of 6.2 percent applied to box 3 wages.
- If an employee exceeded the wage base at multiple employers, note that excess tax credit rules apply.
Medicare Wages and Tax
- Enter Medicare wages and tips in box 5 without a wage base ceiling.
- Include tips reported by the employee under section 3401(c) rules for proper Medicare tax calculation.
- Calculate Medicare tax withheld in box 6 at the 2010 employee rate of 1.45 percent applied to all Medicare wages and tips.
Elective Deferrals and Retirement Plans
Box 12 Deferral Limits
Report elective deferrals in box 12 with appropriate 2010 codes and limits.
- Code D, E, F, or S deferrals are capped at $16,500 for 401(k), 403(b), and 457(b) plans.
- Code H deferrals for SARSEP plans are limited to $16,500 for the 2010 tax year.
- Code AA and BB deferrals follow the same limits as their respective plan types.
- Add $5,500 catch-up contributions if the employee is age 50 or older for 401(k), 403(b), and 457(b) plans.
- SIMPLE 401(k) and 408(p) plans are limited to $11,500 base with $2,500 catch-up for employees age 50 or older.
Retirement Plan Indicator
- Check box 13 if the employee participates in an employer-sponsored retirement plan.
- This flag limits deductible traditional IRA contributions on the Form 1040.
Dependent Care and Other Benefits
Dependent Care Benefits
- Report dependent care benefits in box 10, separating nontaxable amounts up to $5,000 from taxable excess included in box 1.
- An employee must file Form 2441 to reconcile dependent care benefit amounts.
Box 12 Additional Codes
Identify and code all other reportable items in box 12 using only 2010-approved codes.
- Use codes A, B, M, or N for uncollected taxes.
- Use code C for group-term life insurance over $50,000.
- Report nontaxable items with codes J, L, P, or Q as applicable for the tax year.
Additional common codes include:
- HSA contributions: code W
- Nonqualified plan deferrals: code Y
- Section 409A income: code Z
- HIRE exempt wages: code CC
Filing Deadlines and Distribution
Employee Copies
- Furnish copies B, C, and 2 to the employee by January 31, 2011.
SSA Filing Requirements
- File Copy A with Form W-3 to SSA by February 28, 2011.
- Filing 250 or more forms electronically extends the deadline to March 31, 2011.
2010 Year-Specific Requirements
HIRE Act Reporting
HIRE Act code CC was added to box 12 in 2010 to identify tax-exempt wages for employers who hired unemployed workers under the Hiring Incentives to Restore Employment Act.
- No tax withholding is required on these wages for the employer's share of Social Security tax.
- No HIRE Act wage credits apply directly to Form W-2; HIRE Act exemption is tracked via code CC, but actual credit is claimed by the employer on Form 941.
Elective Deferral Limits Summary
- 401(k) plans: $16,500 base, $5,500 catch-up at age 50 or older
- SIMPLE retirement accounts: $11,500 base, $2,500 catch-up
- Section 403(b) plans: $16,500 base or up to $19,500 if the 15-year rule applies
- Catch-up amounts are not subject to the overall deferral limit.
Advance EIC Payment Rules
Advance EIC payment rules remain active in box 9 for 2010 reporting. An employee with one qualifying child may claim up to $1,830 in advance payments. The employee must submit a completed Form W-5 filed with the employer to receive advance payments.
- Income limits:
- $35,535 single
- $40,545 married filing jointly for one child
Section 409A Deferred Compensation
Section 409A deferred compensation plan contributions using codes Y and Z require careful separation.
- Code Y deferrals are not included in box 1.
- Code Z distributions are included in box 1 and subject to an additional 20 percent tax plus interest.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
