Form W-2 Boxes: Line by Line Instructions
Updated on October 10, 2023 - 10:30am by, TaxBandits
If you operate a business and pay your employees, you are required to
file Form W2 with SSA. You must also send a copy of Form W2 to each employee before January 31 annually. You may have to file Form W-2 with the state depending upon your state requirements.
To complete W-2 for the tax year 2023, you should be well acquainted with the
W2 instructions. In this article, we explain the purpose of each box of W2 and how to fill them.
Here, we cover the following topics:
1. What is the purpose of the Form W-2?
Form W-2 is a wage tax form used to report the gross wages paid to employees and the taxes (social security, income, and Medicare) withheld from these employees to the SSA (Social Security Administration).
2. Line by Line Instructions to complete your Form W2
Completing your W-2 accurately is as important as paying the taxes. Incomplete or incorrect information in your W-2s may attract penalties. To stay away from unnecessary penalties, complete your W2s free of errors. To help you with this, we will explain each box of Form W2 and the information to be entered in it.
Let’s have a quick look at W2 instructions:
Box a - Employee’s Social Security Number
Enter the employee’s 9-digit SSN.
Box b - Employer Identification Number (EIN)
Enter the EIN assigned by the IRS. You should not truncate the EIN or use your SSN. If you don’t have an EIN when e-filing, you can enter all 0s. You can then apply for EIN by filing SS-4.
Box c - Employer name, address, and ZIP code
Enter the employer’s name and complete address, including ZIP code. As per the U.S. Postal Service, do not use commas or periods in return addresses.
Box d - Control number
You may use this box to provide a reference number to identify each W-2. This is an optional box.
Box e - Employee’s name
Enter the complete name, including first name, middle initial, and last name.
Box f - Employee’s address and ZIP code
Enter the number, street, and apartment or suite number. As per the U.S. Postal Service, do not use commas or periods in return addresses.
Box 1 - Wages, tips, other compensation
Enter the total taxable wages, tips, prizes, bonuses, and other compensation that you paid to your employee for the year. Box 1 does not include any tax benefits such as savings contributions to a 401(k) plan, 403(b) plan, or health insurance.
Box 2 - Federal income tax withheld
Enter the total federal income tax that was withheld from your employee's wages for the year.
Box 3 - Social security wages
Enter the total wages paid subject to the employee Social Security tax. For the 2023 tax year, the maximum social security wage base is $160,200. The sum of boxes 3 and 7 should not exceed $160,200.
If you’re reporting for Household Employees for the tax year 2023, the sum of Social Security Wages and Tips must be equal to or greater than $2,600.00.
If this sum is less than $2,600.00, enter zeros in the Social Security Wages & Social Security Tips boxes.
Note: The SSA will reject your return if the sum is non-zero and less than $2,600
Box 4 - Social security tax withheld
Enter the total employee social security tax (excluding employer share) withheld, including social security tax on tips. For 2023, the amount should not exceed $9,932.4 ($160,200 × 6.2%).
Box 5 - Medicare wages and tips
Enter the employee’s wages and tips subject to Medicare tax. There is no wage base for Medicare taxes.
If you’re reporting for Household Employees for the tax year 2023, the sum of Medicare Wages and Tips must be equal to or greater than $2,600.00.
If this sum is less than $2,600.00, enter zeros in the Medicare Wages & Tips boxes.
Note: The SSA will reject your return if the sum is non-zero and less than $2,600.
Box 6 - Medicare tax withheld
Enter the total amount of Medicare tax withheld. This amount includes:
- 1.45% Medicare tax withheld on all Medicare wages and tips shown in Box 5
- 0.9% Additional Medicare tax on any FICA or RRTA compensation paid above $200,000
Include only the tax withheld for 2023 wages and tips, do not include employer share.
Box 7 - Social security tips
Enter any tips the employee reported to the employer. The sum of boxes 3 and 7 should not exceed $160,200 (for 2023).
Box 8 - Allocated tips (not applicable to Forms W-2AS, W-2CM, W-2GU, or W-2VI)
Enter any tips that were allocated to the employee. Allocated tips amount should not be included in
Boxes 1, 3, 5, or 7.
Box 10 - Dependent care benefits (not applicable to Forms W-2AS, W-2CM, W-2GU, or W-2VI)
Enter the total dependent care benefits provided under a dependent care assistance program. Include any amounts over $5,000 in boxes 1, 3, and 5.
Box 11 - Nonqualified plans
Enter the total amount distributed to employees from the employer’s non-qualified deferred compensation plan or non-government Section 457 pension plan.
Box 12 - W2 instruction Codes For Compensation and Benefits
Enter the appropriate W2 box 12 codes and enter the amount in this box. Codes and its description are given below:
Box 12 Codes Description A Enter the code "A" to show the uncollected social security or RRTA tax on tips. Do not include this amount in box 4. B Enter the code "B" to show the uncollected Medicare tax on tips. Do not show any uncollected Additional Medicare Tax. Do not include this amount in box 6. C Taxable cost of group-term life insurance over $50,000 D Enter the code "D" to show the elective deferrals under a section 401(k) cash or deferred arrangement (plan). E Enter the code "E" to show the elective deferrals under a section 403(b) salary reduction agreement. F Enter the code "F" to show the elective deferrals under a section 408(k) (6) salary reduction Simplified Employee Pension plan (SEP). G Enter the code "G" to show the elective deferrals and employer contributions (including non elective deferrals) to any governmental or nongovernmental section 457(b) deferred compensation plan. H Enter the code "H" to show the elective deferrals under section 501(c) (18)(D) tax-exempt organization plan. J Enter the code “J” to show the non-taxable sick pay. K Enter the code “K” to show the 20% excise tax on excess golden parachute payments. L Substantiated employee business expense reimbursements. M Enter the code "M" to show the uncollected social security or RRTA tax on taxable cost of group-term life insurance over $50,000 (for former employees). N Enter the code "N" to show the uncollected Medicare tax on taxable cost of group-term life insurance over $50,000 (for former employees). P Enter the code “P” to show the excludable moving expense reimbursements paid directly to a member of the U.S. Armed Forces. Q Nontaxable combat pay (only for military personnel). R Enter the code “R” to show the employer contributions to an Archer MSA. S Enter the code “S” to show the Employee salary reduction contributions under a section 408(p) SIMPLE plan. T Enter the code “T” to show the adoption benefits. V Enter the code “V” to show the Income from the exercise of nonstatutory stock option(s). Include this amount in boxes 1, 3 (up to the social security wage base), and 5. W Enter the code “W” to show the Employer contributions to a health savings account (HSA). Y Enter the code “Y” to show the deferrals under section 409A on a nonqualified deferred compensation plan. Z Enter the code “Z” to show the income under a nonqualified deferred compensation plan that fails to satisfy section 409A. AA Enter the code "AA" to show the designated Roth contributions under a
section 401(k) plan.
BB Enter the code "BB" to show the Designated Roth contributions under a
section 403(b) plan.
DD Enter the code "DD" to show the cost of employer-sponsored health coverage. EE Enter the code “EE” to show the designated Roth contributions under a governmental section 457(b) plan. FF Enter the code “FF” to show the permitted benefits under a qualified small employer health reimbursement arrangement. The maximum reimbursement for an eligible employee for 2022 is $5,450 and $11,050 for families. GG Enter the code “GG” to show the Income from qualified equity grants under section 83(i). HH Enter the code “HH” to show the aggregate deferrals under section 83(i) elections as of the close of the calendar year.
Box 13 - Checkboxes
- Check the Statutory employee box for statutory employees whose wages are subject to social security and Medicare taxes, but not subject to federal income tax withholding.
- Check the Retirement plan box if the employee is an active participant in any of the following.
Check the Third-party sick pay box if you are a third-party sick payer
filing a Form W-2 for an insured employee or an employer reporting sick pay payments made by a third party.
Note: Check all boxes that apply.
Box 14 - Other
Employers use this box 14 to report information such as:
- State disability insurance taxes withheld
- Union dues
- Uniform payments
- Health insurance premiums deducted
- Nontaxable income
- Educational assistance payments
- A member of the clergy’s parsonage allowance and utilities
- Charitable contributions made through payroll deduction
Box 15 - State Information
Report the employer's state and state tax identification number
Box 16 - State wages, tips, Information
Report the total amount of taxable wages employees earned in that state.
Box 17 - State income tax
Report the total amount of state income taxes withheld from the paychecks for the wages reported in Box 16.
Box 18 - Local wages, tips, etc
Report the total amount of wages subject to local or city income taxes.
Box 19 - Local income tax
Report the total amount of taxes withheld from wages for local or city income taxes.
Box 20 - Locality name
Provide information on your locality name for which the tax is being paid.
General Instruction for Boxes 15 to 20
These boxes can be used to report wages and taxes for two states or localities. Enter state and local information in separate lines.
3. How to fill out Form W-2 with TaxBandits?
Generally, the SSA accepts both the paper filing and electronic filing of W2 online. However, e-filing is the most preferred method because of its convenience and faster processing rate.
To help you e-file W2 with the SSA, TaxBandits is here! TaxBandits is an IRS-certified e-file service provider. We support the e-filing of various tax forms, including W-2. When you file your tax returns with TaxBandits, every form will be checked against the IRS business rules and validations. This ensures that your forms will reach the SSA without errors, and the chance of rejection is significantly lower. Whether you want to e-file W2s for 5 employees or 5000 employees, we have solutions for businesses of all sizes. Check out our intuitive tax filing features to complete your e-filing today.
Here’s how you need to e-file W-2 forms with TaxBandits:
- Sign up or log in to your TaxBandits account.
- Click on Start New Form and select the Form W-2 button.
- Select the Tax Year.
- Choose your preferred filing method. There are two options available - Manual data entry and Bulk upload.
Manual data entry
- Enter the employer and employee details.
- Fill in the boxes 1- 14. Check “I want to allow my employees to access their forms online, including Form W-2 box”. This option allows your employee to view and download their forms online. To know more about TaxBandits’ Online Access, click here.
- Enter the State details and click on Save and Continue.
- Add more W2 forms if needed. Review the filing summary to select the recipients and choose the postal mailing option if required.
- Select the services you want for this filing order.
- Pay the service charges and transmit your W-2 forms.
- Enter the employer details.
- Download the W-2 Excel template and fill in the W-2 information or use your own template.
- Upload the filled template and continue.
- If errors are found, clear them using the steps given here.
- If no errors are found, continue filing.
- Review the filing summary to select the recipients and choose the postal mailing option if required.
- Select the services you want for this filing order.
- Pay the services charges and transmit your W-2 forms.
After your return is transmitted, we will notify you of the status of your return via email. You can also log in to your TaxBandits account and check your return status from your Dashboard.
Why wait?and e-file W-2s in a few easy steps.