The IRS mandates e-filing when filing 10 or more W2 returns for the 2023 tax year. E-File Now

New Form W-2 Changes for the 2023 Tax Year

Updated on January 22, 2024 - 10:30am by, TaxBandits

Starting from the 2023 tax year, the IRS has increased the Form W-2 penalty rates due to adjustments for inflation and increased the social security wages base from $147,000 to $160,200. Continue reading to learn more about the IRS changes in Form W-2 for the 2023 tax year.

1. What are the changes to Form W-2 for 2023?

The IRS has made several updates to the Form W-2 for the 2023 tax year. Employers should be aware of the
following updates.

  • Change 1: E-filing Threshold

    The IRS has lowered the e-filing threshold for reporting Form W-2 and other information returns (1099, ACA Forms, etc.) from 250 returns to 10 or more aggregate returns. These changes will be effective for returns filed after January 1, 2024.

  • Change 2: Updates to employee section

    The SSA has increased the social security wages limit from $147,000 to $160,200 for the tax year 2023. Therefore, the total of the Box 3 (Social security wages) and Box 7 (social security Tips) should not exceed the $160,200.

  • Change 3: Box 4

    Since the social security wages limit has been increased to $160,200, the Social security tax withheld should not exceed $9,932.40 ($160,200 × 6.2%).

  • Change 4: Penalty Changes

    The IRS has increased penalties for failure to file Forms W-2 to account for inflation. See the table below for the updated penalty amounts.

Number of days late For 2022 Tax Year For 2023 Tax Year

Filed within 30 days
from the deadline

$50 per form to a maximum penalty of $588,500 per year ($206,000 for small businesses).

$60 per form to a maximum penalty of $630,500 per year ($220,500 for small businesses).

Filed after 30 days and
within August 1st

$110 per form to a maximum penalty of $1,766,000 per year ($588,500 for small businesses).

$120 per form to a maximum penalty of $1,891,500 per year ($630,500 for small businesses).

Filed after August 1

$290 per form to a maximum penalty of $3,532,500 per year ($1,177,500 for small businesses).

$310 per form to a maximum penalty of $3,783,000 per year ($1,261,000 for small businesses).

International Disregards

$580/form to no maximum limits

$630/form to no maximum limits

Learn more about IRS penalties by visiting https://www.taxbandits.com/w2-forms/form-w2-penalty/


2. When is the Form W-2 deadline for 2023?

The Form W-2 is required to be filed with the IRS/SSA and distributed to employees no later than January 31, 2024. If the W-2 deadline for filing falls on a weekend or federal holiday, the next business day becomes the deadline.


3. Advantages of E-filing Form W-2 with TaxBandits

E-filing your Form W-2 with TaxBandits offers numerous advantages tailored to simplify and enhance your filing experience. Our e-filing process is specifically designed to take the guesswork out of filing forms for your business or on behalf of your clients.

With TaxBandits, you can file your Form W-2 with SSA and State and distribute employee copies to your recipients through either mail or a secure online portal.

TaxBandits allows you to file multiple returns by importing your data through Excel/CSV templates. Plus, you can easily connect TaxBandits with your favorite accounting software to easily import your data and complete your filing easily without the need for any code or third-party software.

Additionally, you can take advantage of these additional filing features:

  • Support for W-2 correction
  • Internal audit check
  • Excellent live customer support
  • Multiple user access for CPA and tax pros
  • Online client portal to communicate with your clients
  • Flexible pricing

Get started with TaxBandits today and e-file W2 as the lowest price in the industry. E-File Now


4. How to File Form W2 for 2023?

Filing your Form W2 with TaxBandits is an easy and simplified process; follow the simple steps below:

  • Step 1: Create an account and choose W-2 Form
  • Step 2: Enter the Form W2 Information
  • Step 3: Review the Form summary
  • Step 4: Transmit it to the SSA & State
  • Step 5: Distribute the recipient copies

If you have opted-in to postal mailing or online access services, TaxBandits will take care of the distribution of your recipient copies on your behalf.

TaxBandits for Every Business