Form W-3 Transmittal of Wage and Tax Statements: A Complete Guide for 2023

What Form W-3 Is For

Form W-3 serves as the transmittal (or cover sheet) that employers use to send Copy A of all Forms W-2 to the Social Security Administration. It's essentially a summary document that totals all the wage and tax information from your individual employee W-2 forms.

You must file Form W-3 if you're required to file Forms W-2—meaning you had one or more employees in 2023 to whom you paid wages (including non-cash payments) for services in your business. Form W-3 cannot be filed alone; it must accompany at least one Form W-2. The form includes aggregate totals of wages paid, federal income tax withheld, Social Security wages and taxes, Medicare wages and taxes, and other compensation details across all your employees.

Even if you have just one household employee, you still need to file Form W-3 along with that employee's W-2. The form helps the SSA, IRS, and state/local governments reconcile your employment tax returns (Forms 941, 943, 944, CT-1, or Schedule H) with the wages you actually reported paying to employees.

When You’d Use Form W-3

Standard Deadline

For 2023 Forms W-2, you must file Form W-3 along with Copy A of all W-2s by January 31, 2024, whether filing on paper or electronically. This deadline applies to both filing with the SSA and furnishing copies to employees—there's no longer a separate, extended deadline for filing with the government.

Late Filings

If you miss the January 31 deadline, file as soon as possible. You'll face penalties for each Form W-2 filed late (more on this below), but filing promptly minimizes the damage. There's no such thing as an automatic extension for Form W-3.

Requesting an Extension

Extensions for Forms W-2 and W-3 are granted only in extraordinary circumstances or catastrophes (such as natural disasters or fires that destroy your records). You must submit Form 8809 (Application for Extension of Time to File Information Returns) before the due date, showing that you meet at least one qualifying criterion. If approved, you'll receive only a 30-day extension—and no additional extensions beyond that. Importantly, even if the SSA grants you an extension to file Forms W-2 and W-3, you must still furnish W-2s to your employees by January 31, 2024.

Amended/Corrected Filings

If you discover errors after filing, you'll need to file Form W-3c (Transmittal of Corrected Wage and Tax Statements) along with corrected Forms W-2c. File these corrections as soon as possible after discovering the error. Form W-3c follows similar procedures to the original W-3 but includes both "previously reported" and "correct information" columns to show what you're changing. You must file a separate W-3c for each tax year, form type, and kind of payer/employer being corrected.

Key Rules or Details for 2023

Several important rules govern Form W-3 filing for the 2023 tax year:

• Electronic Filing Threshold: If you file 250 or more Forms W-2, you must e-file them (along with Form W-3) through the SSA's system. Failing to e-file when required can result in penalties. You can e-file through the SSA's free Business Services Online (BSO) portal, which also auto-generates Form W-3 based on your W-2 data. Even if you're not required to e-file, the SSA strongly encourages it for faster, more accurate processing.
• Paper Filing Requirements: If filing on paper, use only original IRS forms with red ink (Copy A) or approved substitute forms that meet IRS Publication 1141 specifications. Do not download and print Copy A from IRS.gov—the SSA won't accept it. Use black ink in 12-point Courier font, include decimal points and cents, never staple or fold the forms, and mail them flat.
• No Advertising Allowed: You cannot include any advertising, logos, slogans, or coupons (such as discounts for tax preparation services) on Form W-3 or Copy A of Forms W-2. This prohibition helps prevent confusion and ensures forms are taken seriously.
• Reconciliation Requirement: The totals on your Form W-3 must match the wage and tax totals from your quarterly or annual employment tax returns (Forms 941, 943, 944, CT-1, or Schedule H). Discrepancies will trigger IRS or SSA inquiries. Due to COVID-19-related employment tax credits and relief programs, you may have legitimate reconciliation differences—document these carefully and be prepared to explain them.
• Social Security Wage Base: For 2023, the Social Security wage base is $160,200. Make sure no single employee's Social Security wages on their W-2 exceed this amount. All wages above this threshold are still subject to Medicare tax but not Social Security tax.
• Separate Forms for Different Entities: File separate W-3 forms for each type of payer or employer, each tax year, and each type of W-2 form (standard W-2 vs. territorial forms like W-2GU for Guam).

Step-by-Step (High Level)

Here's how to complete and file Form W-3 for 2023:

Step 1: Gather Your W-2s.

Before completing Form W-3, finalize all your individual employee Forms W-2 for the year. Arrange them either alphabetically by employees' last names or numerically by Social Security numbers.

Step 2: Calculate Totals.

Add up the amounts from corresponding boxes across all your W-2 forms. For example, total all amounts from Box 1 (wages, tips, other compensation), Box 2 (federal income tax withheld), Box 3 (Social Security wages), and so on. These totals will go in the corresponding boxes on Form W-3.

Step 3: Complete Form W-3.

Fill in your business information (name, address, EIN) exactly as it appears on your employment tax returns. Check the appropriate boxes for your type of employer (e.g., "941" if you filed quarterly Form 941, "Hshld. emp." if you're a household employer). Enter the total number of W-2 forms you're transmitting. Fill in all the money boxes with your calculated totals from Step 2. Sign and date the form.

Step 4: Review for Accuracy.

Double-check that your EIN is correct (not an employee's SSN), amounts include decimal points and cents, boxes reconcile with your employment tax returns, and you've used black ink on legible forms.

Step 5: File with the SSA.

If e-filing, upload your W-2s through the SSA's BSO portal (which generates W-3 automatically). If filing on paper, mail Form W-3 with Copy A of all W-2s to: Social Security Administration, Direct Operations Center, Wilkes-Barre, PA 18769-0001. Do not staple forms together. Send in a flat mailing (don't fold).

Step 6: Keep Copies.

Retain copies of Form W-3 and all Forms W-2 (Copy A) for at least four years. You'll need these for your records and potential audits.

Step 7: File with State/Local Authorities (if required).

Send Copy 1 of Form W-2 to your state, city, or local tax department as required by their rules.

Common Mistakes and How to Avoid Them

The IRS and SSA report these frequent errors cause processing delays and penalties:

1. Using Downloaded Forms: Never print Copy A of Form W-3 or W-2 from IRS.gov for submission to the SSA. They require original red-ink forms or approved substitutes. (You can print employee copies and informational copies.)
2. Wrong Employer Identification Number: Entering an employee's SSN instead of your business EIN in the employer EIN field is surprisingly common. Always double-check your 9-digit EIN (format: XX-XXXXXXX).
3. Missing Decimal Points and Cents: All money amounts must include decimal points and cents (e.g., $45,230.00, not $45230 or 45230.00 without the dollar structure).
4. Poor Print Quality: Using ink that's too light, fonts that are too small or large, or non-black ink causes machine-reading errors. Stick to black ink in 12-point Courier font.
5. Adding Dollar Signs: Don't add dollar signs ($) to the money boxes—they've been removed from Copy A and aren't needed.
6. Physical Damage to Forms: Cutting, folding, stapling, or tearing forms interferes with machine scanning. Keep forms flat and pristine.
7. Reconciliation Errors: Your W-3 totals must match your employment tax returns. Common reconciliation mistakes include:
   • Reporting bonuses inconsistently across forms
   • Putting Social Security tax in the Social Security wages box (or vice versa)
   • Reporting Medicare wages less than Social Security wages (Medicare wages should always equal or exceed Social Security wages)
   • Showing nonzero taxes with zero corresponding wages
   • Exceeding the $160,200 Social Security wage base for individual employees
8. Mismatched EINs: If you used different EINs on your quarterly Forms 941 during the year, you must list the alternate EIN in Box h ("Other EIN used this year") on Form W-3.
9. Filing Wrong Copies: Mailing the wrong copy (B, C, or D) instead of Copy A to the SSA causes rejection.
10. E-filing Violations: If you're required to e-file (250+ forms) but file on paper instead, you'll face penalties.

How to Avoid These Mistakes: Use the SSA's e-filing system when possible (it catches many errors automatically), proofread carefully before filing, reconcile your totals against employment tax returns before submitting, and consider using payroll software or a professional payroll service to ensure accuracy.

What Happens After You File

Once you file Form W-3 with the SSA:

• Processing Time: The SSA processes your W-2s and posts the wage information to your employees' Social Security earnings records. This affects their future Social Security benefits. The SSA also shares the tax withholding information with the IRS for income tax processing.
• Electronic Confirmations: If you e-file, the SSA's BSO system provides immediate confirmation of receipt and alerts you to any errors that need correction. You'll receive email notifications about the status of your submission.
• Rejection Notices: The SSA will reject wage reports (both electronic and paper) under certain conditions—for example, if Medicare wages are less than Social Security wages, or if you report taxes with no corresponding wages. You'll receive an email or postal notification to correct and resubmit the report. (Note: Don't write "corrected" or "amended" on resubmitted reports—just fix the errors and resend.)
• IRS Matching: The IRS receives your wage information and uses it to verify taxpayers' income when they file their individual tax returns. Discrepancies between what you reported and what employees claim may trigger IRS inquiries.
• Potential Follow-Up: If the IRS or SSA finds discrepancies between your Form W-3, Forms W-2, and your employment tax returns, they may send you a notice requesting clarification or correction. Respond promptly to these notices.
• Penalties (If Filed Late or Incorrectly): For 2023 returns filed in 2024, penalty amounts are:
  • Up to 30 days late: $50 per W-2 form
  • 31 days late through August 1: $110 per form
  • After August 1 or not filed: $290 per form
  • Intentional disregard: $580 per form (no maximum)
    There are maximum penalties for small businesses (average annual gross receipts of $5 million or less), but larger businesses face higher maximums. Penalties apply to each form filed incorrectly or late, so with many employees, penalties can accumulate quickly.
• Penalty Relief: You may request penalty relief if you have "reasonable cause"—meaning you acted responsibly and the failure resulted from circumstances beyond your control (illness, natural disaster, unavoidable system failures, etc.). Submit a written explanation with supporting documentation to the address on any penalty notice you receive.

FAQs

1. Do I need to file Form W-3 if I only have one employee?

Yes. Even employers with a single employee (including household employers with one domestic worker) must file Form W-3 to transmit that employee's W-2 to the SSA. Check the "Hshld. emp." box on Form W-3 if you're a household employer.

2. Can I file Form W-3 without any Forms W-2?

No. Form W-3 cannot be filed alone—it exists only to transmit Forms W-2. If you have no employees and paid no wages requiring W-2s, you don't file either form.

3. What's the difference between Form W-3 and Form W-3c?

Form W-3 is the original transmittal for your annual W-2s. Form W-3c is the corrected transmittal you file when you need to amend previously filed W-2s due to errors. The W-3c includes columns for both "previously reported" and "correct information" to show what changed.

4. If I e-file Forms W-2, do I still need to complete Form W-3?

If you e-file through the SSA's BSO system, it automatically generates Form W-3 based on your W-2 data—you don't need to create a separate W-3. However, if you e-file through other approved methods (like file upload), you must include W-3 information in your electronic file.

5. What if I discover an error after I've already filed Form W-3 and W-2s?

File corrected forms (W-2c and W-3c) as soon as possible after discovering the error. You may also need to file amended employment tax returns (such as Form 941-X) depending on the nature of the error. Don't delay—prompt correction minimizes penalties.

6. Can I mail Form W-3 and W-2s to the IRS instead of the SSA?

No. Form W-3 and Copy A of Forms W-2 go to the Social Security Administration, not the IRS. The address is: Social Security Administration, Direct Operations Center, Wilkes-Barre, PA 18769-0001. The SSA shares the information with the IRS electronically.

7. What happens if my Form W-3 totals don't match my Form 941 totals?

The IRS or SSA will likely contact you requesting an explanation. Some discrepancies are legitimate (for example, if you claimed COVID-19 employment tax credits, or if you filed employment taxes under multiple EINs). Document your reconciliation carefully and respond to any notices promptly. Major unexplained discrepancies can trigger audits or penalties.

Additional Resources

All information in this guide comes from official IRS sources:

• About Form W-3 (IRS.gov)
• 2023 General Instructions for Forms W-2 and W-3 (IRS.gov)
• Information Return Penalties (IRS.gov)

For questions about e-filing or BSO registration, call the SSA's Employer Reporting Service Center at 800-772-6270 (toll-free). For tax questions about Forms W-2 and W-3, call the IRS information reporting customer service at 866-455-7438 (toll-free).

This summary is for educational purposes based on IRS guidance for the 2023 tax year. Consult a tax professional or the IRS directly for advice specific to your situation.