- [Instructor] Most people who pay attention to their taxes
are probably at least vaguely familiar with the W-2.
But what people don't think about is how it works.
When you give a copy of a W-2 to an employee,
the government needs to get that same information.
That's how they prevent tax fraud after all, right?
The W-3 accomplishes that goal.
This is a generic copy of a W-3.
Now, when you submit this to the government,
you will also need to submit copies of the W-2s.
These go to the Social Security Administration.
This is typically done online
through Business Services online.
That'll make the process much more efficient.
Generally, it can be done through
the Social Security Administration's portal
and you'll have an automated report
that's spit out of your payroll tax software,
but for right now, let's just talk about the W-3.
So, up here in Section B,
you're going to check the type of payer you are.
In most cases, you'll probably be a 941 payer.
If you're a non-profit organization,
you'll have to check under Kind of Employer
which type of 501(c)3 organization you are.
Again, most of the organizations out there
are not going to be a 501(c)3,
so in most cases, none of these will apply.
Once you've done that, you'll move to Section C,
and you'll put in the total number of W-2 forms
you sent out.
You'll also put in, in Section E,
your Employer Identification Number.
In Section F, your name.
In Section G, your address and zip code.
In most cases then, you won't have anything in Section H
for other EINs.
From here, you'll move over
and talk about the types of funds
that you've paid out to employees.
So in box one, three, five, and seven,
you'll need to go through and list
any compensation paid to employees.
Again, Social Security wages cap out
at just around $120,000,
so you may have a little bit less in Social Security wages
than you have in aggregate wages.
But otherwise, for the most part,
boxes one, three, and five
will have the same wage information in them.
From there, in boxes two, four, and six,
you'll have to talk about
the federal income tax that's been withheld,
the Social Security tax that's been withheld,
and the Medicare tax that's been withheld.
This is the tax level that has been withheld
from each employee's check throughout the year.
And again, these are totals for all employees,
so this needs to match the sum of all of your W-2s
that have been issued to employees throughout the year.
Now, if you don't file your W-3 properly,
it's almost certain to cause an audit
and significant penalties,
so make sure that you've added up
all of the wages that you paid correctly
and that you have the correct number
of W-2 forms listed here.
Once you've done that,
you should be able to safely submit to the IRS
and the Social Security Administration.
Just be sure that you have the proper forms
submitted to both groups.