We are almost at the deadline for sending W-2s. If you’ve already sent them out, these W-2 compliance tips will be great for 2022 year-end. If not, you have a little bit of time left to tie things up and get them out to your employees.
Employer Responsibilities
As the employer who will be sending out the W-2s, you’re responsible for all the copies, as well. Copies B, C, and 2 are to be sent to your employee. Copy A goes to the Social Security Administration, Copy 1 is to be submitted to the state tax authority if applicable, and Copy D is for you to keep with your employer records.
A single employer is only required to submit one W-2 per employee, even if the employee in question has worked in multiple roles. The only instances in which an exception would be made are if a single employee worked in multiple roles across different locations or if company ownership changed mid-year. In these special cases, W-2s must be issued for each different EIN (Employer Identification Number) that said employee worked for.
Compliance and 2022 Changes
The IRS recently published the Employer’s Tax Guide, which helps identify the items that employers are responsible for this tax season, as well as highlights the latest updates as they pertain to your business and operations.
One update addresses the COVID-19 related credit given for sick and family leave wages. This credit is limited to leave that was taken after March 30, 2020, and before October 2021.
The COVID-19 related employee retention credit has expired, and COBRA premium assistance payments credit is limited to coverage periods on or after April 1, 2021, through coverage periods that began on or before September 30, 2021.
There are also some updates and reminders regarding Social Security and Medicare Tax, as well as deferment amounts of the employer share of these taxes. All of these insights can be found in the IRS 2022 Publication 15.
Compliance Tips for 2022 Filing
This year, employers are able to further protect employee privacy by only including a truncated version of the employee’s Social Security Number, using only the last four digits for the copies submitted to the employee. Please note: EINs are still never to be shortened.
Due to the passing of the Taxpayer First Act, IRS forms (including W-2s) will have a smaller threshold in order to overlook electronic filing. Currently, the threshold for electronic filing is 250 or more forms, but in 2022 that number will be lowered to 100, and 2023’s threshold will be 10.
Penalties for missed deadlines have also increased this year. For forms filed within 30 days after the deadline, employers owe $50, and that number jumps to $110 for forms filed after that 30 days but before August 1, and finally, a $280 penalty is incurred for any forms filed after August 1.
eFile360: Compliance Made Easy
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If you are planning on mailing forms instead, skip the hours of printing, folding, and stuffing envelopes. Submit your forms to us, and we’ll take care of the rest for you. You’ve got enough on your plate trying to run your business and set a good example of leadership for your company and the communities you serve. Let us help you with the details so you can get back to the important stuff.
Sign up for a free eFile360 account today and let eFile360 help you manage compliance items through 1099, 1098, ACA, and W-2 e-filing.