What To Do If You’re Late On W-2 Distribution

Year end is usually an extremely hectic and stressful time for employers and HR workers. Tax season means scrambling to get W-2 forms from payroll and onto employees as soon as possible. Employers have until January 31st to deliver their W-2s to workers. If you’ve been prepping all year long and sticking to deadlines for an easy year end, the process should be simple, but life doesn’t always work out that way… If you’re one of the many companies rushing to get those W-2s out, don’t panic, here is what you should do!

Mailing W-2s

Remember, employers only need to have their W-2s postmarked by January 31st. The W-2s themselves don’t need to be in employee’s hands at that time. If an employee quits within any time before December 31 of the current tax year, the employer may deliver the W-2 copies to the employee at any time starting with the date of termination, but no later than the January 31 deadline. Employers are required to provide copies of the W-2 within 30 days of termination or their final wage payment, whichever is the latter date.

Filing W-2s Online

One of Social Security’s services offered to employers is their Business Services Online tool. This service provides employers with the option to file W-2s and to verify employees’ names and Social Security numbers. By registering at Business Services Online employers, CPAs, accountants, enrolled agents, and individuals who process W-2s can access fast, free, and secure online W-2 filing options. Upload wage reports, complete up to 50 W-2 forms and print copies for distribution to employees without any software involved.

Contact the IRS

When all else fails and you know you will be late on your delivery of W-2s to employees, there is an option to request an extension by writing into the IRS. If you are unable to prepare on time, contacting the IRS with a written explanation for why your company was incapable of meeting the January 31st deadline could grant you forgiveness with an extended period for W-2 delivery.

Just Pay Up

If you do end up failing to file on time without any grace period from the IRS, penalties can be assessed based on incorrect file forms, incomplete file forms, or if forms are illegible. For businesses with over 250 employees, e-filing (filing online - listed above) is required or fines will be enforced if turned in by paper.

Don’t worry if mistakes are made, this is why double checking work is so important. If you do catch a mistake with a W-2, just notify the IRS with the corrections. Even if you have a third-party payroll provider, your business is still responsible for checking W-2s and filing them without error and on time to employees.

Preparing for year-end and need a little help? Check out Dominion's year-end resources page for free and helpful tips to get W-2s out the door.