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How to File and Provide W-2s, W-3s, & 1099 Forms – Plus Important Updates for the 2013 Reporting Season

How to File and Provide W-2s, W-3s, & 1099 Forms – Plus Important Updates for the 2013 Reporting Season

By Caron_Beesley, Contributor
Published: January 14, 2013 Updated: January 14, 2013

It’s that time of year again—W-2, W-3 and 1099 reporting season.

The Affordable Care Act has changed things a little this year in terms of the information you must provide your employees on their W2s. Read on for an update and a refresher of other reporting obligations and how to file the right forms.

Reporting Employee Wages and Taxes – What’s New on Form W-2

If you paid an employee any amount in wages in 2012, you must issue an annual W-2 form to report the wages, income tax, and FICA tax withholding, along with certain other employment-related payments. You should provide this information to both your employees and the Social Security Administration (SSA).

*New for the 2012 Tax Year* – As a result of the Affordable Care Act, businesses that provide health insurance to their employees are required to report the cost of coverage on employee W-2s. However, in order to allow businesses to update their payroll systems to support this requirement, most small employers are exempt from this requirement for the year 2012.  The criteria are as follows:

  • If you filed fewer than 250 W-2 forms in 2011, you are not required to report the cost of coverage on 2012 forms (filed with the SSA in early 2013). You do have the option of doing so, if you wish.
  • If you filed more than 250 W-2s, you will be required to comply with the new reporting requirements starting with the 2012 Form W-2.

If you are required or choose to report, the amount you report should include both the employee and employer contribution to the healthcare premium so your employees have a view of the true cost of this benefit. 

Read more on this topic from the IRS: Employer-Provided Health Coverage Informational Reporting Requirements: Questions and Answers.

How to File Form W-2 and W-3 With the Social Security Administration

As an employer, you must file Form W-2 and W-3 with the SSA by February 28, 2013. If you file electronically, the deadline is April 1, 2013. Here’s how to file:

  1. Electronic Filing – If you have less than 20 employees, you can file your W-2s online and print copies for employees. You’ll also need to file Form W-3 form at the same time showing total earnings and taxes withheld for all your employees. To avoid errors, you can verify names and SSNs online to ensure your records align with SSAs.
  2. Paper Filing – Follow these instructions for filing a paper W-2.

Provide Your Employees with W-2 Forms

In addition to filing Form W-2 and W-3 with the SSA, you’ll need to give your employees a copy of their W-2s with a postmarked data of January 31 or earlier. If you filed your W-2s online, these employee forms can be printed out automatically or you can download paper versions from IRS.gov.

Ask your employees to check that all the information on the form is correct. Any errors can be corrected using Form W-2c and Form W-3c.

For forms and updates about W-2 filing requirements, check out this W-2 Wage and Tax Statement Guide on IRS.gov.

Report Payments Made to Independent Contractors on Form 1099

If you used the services of an independent contractor in 2012 (i.e. non-employees), you’ll need to report compensation of $600 or more to the IRS on form 1099-MISC (downloadable here) and provide a copy to independent contractors by January 31, 2013.

Got Questions?

Always consult a knowledgeable tax advisor in matters of business taxation, as errors and mistakes can result in costly penalties.



About the Author:

Caron Beesley


Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed. Follow Caron on Twitter: @caronbeesley