Overview: Taxable wages are earnings paid to an employee that, by law, must have taxes withheld. In contrast, there are non-taxable wages that are not subject to tax withholding.
Responding to employee W-2 inquiries is much easier once you understand the pay variables used to determine the taxable wages on the W-2.
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W-2 Taxable Wages
The Form W-2 provides information regarding the total earnings received from your employer during the previous year, as well as the amount of withholding tax that has been remitted on your earnings.
The following tables cover the most frequently used pay elements in determining taxable wages on the W-2:
Box 1: Wages, Tips, and Other Compensation
Box 3: Social Security Wages
Box 5: Medicare Wages and Tips
Box 16: State Wages, Tips, Etc.
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FAQ
Q: Why does the gross wage total on my final pay stubs differ on my W-2?
A: The amount of compensation may vary between a W-2 and a final pay stub, but there is a reason for this. Your salary is the total amount earned before taxes and deductions, while your Form W-2 displays your taxable wages after pre-tax deductions have been taken into account.
Q: Why did I receive more than one W-2?
A: An employee may have multiple W-2 forms if they have more than one job, they changed jobs throughout the year, their employer changed ownership, or their employer changed their payroll provider.
Q: When will I receive my W-2?
A: Employers are obligated to provide a Form W-2, Wage and Tax Statement to their employees by the IRS deadline of January 31st. If you have opted for an electronic copy, you will receive it no later than Jan 31st. Paper copies must be mailed no later than Jan 31st, so timing of delivery will vary. If you do not receive it by February 15th, reach out to your employer.