By: Stefano Tromba Mar 01, 2021

What is Form W-3 and Do You Have to File One?

By now you’ve sent out your W-2 to your employees. But in addition to that, businesses must also file Form W-3 along with copies of each employee’s W-2 with the Social Security Association (SSA). 

What is Form W-3?

Form W-3, officially the Transmittal of Wage and Tax Statements, is a summary for the SSA of all the business’ employee wages and contributions for the previous year. This document offers a summary of the W-2 forms that are attached and sent with the form in January.

The W-3 provides a way for the SSA to reconcile that all wages were reported for the previous year and all the necessary FICA (Federal Insurance Contributions Act) taxes have also been reported.

What is on Form W-3 ?

Form W-3 totals all of the W-2 data that employers submit in an overview document. The form contains the employer name, EIN (employer identification number), address, contact information, and all other pertinent details.

It also provides a total of all the business’ employee information which includes:

  • Wages, tips, and other compensation
  • Allocated tips
  • Wages/tips subject to Medicare taxes
  • Wages/tips subject to social security tax
  • Federal income tax withheld
  • Social security tax withheld
  • State income tax withheld
  • Medicare tax withheld
  • Deferred compensation
  • Dependent care benefits
  • Non-qualified plans

Businesses need to only file the form with the SSA, along with the corresponding W-2 forms. No payments are sent when filing the W-3

Filing W-3 forms

Small business owners shouldn’t panic because filing the W-3 is simple and requires just adding all the corresponding data you find on an employee’s W-2 form. The W-3 form reflects the W-2 form, with sections 1-11 repeating the necessary data, like wages, tips, and other compensation, federal income tax withheld, etc.

For further assistance, the SSA has a checklist to help business owners complete and file their W-2 and W-3 forms. A helpful IRS video takes you through the steps of reconciling your W-2 forms and the W-3 summary document.

So, there you have it. Tax season isn’t always the most fun time of year but with a bit of help and proper guidance, it can certainly be made easier.

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Category: Payroll | Small Business | Tax

Stefano is a seasoned marketing professional and writer with diverse industry experience. Born and raised in NYC, he holds a Journalism degree from Queens College, and is currently the Head of Marketing at Fingercheck.

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