Everything you need to know about W2 and W4 Forms 1

Everything you need to know about W2 and W4 Forms

The Internal Revenue Service (IRS) mandates that anybody who works for a company fill out payroll tax forms that specify how much tax should be withheld from their salary. It’s the W-4. Your employer must also report your earnings and expenditures to the IRS on a tax form. The W-2 is just that.

Let’s examine both documents—the W2 vs W4—to see how they compare and contrast and how and when to fill them out. As you strive to shell out the amount you owe and nothing more, think about collaborating with a financial advisor.

Depending on who fills out the paperwork and who completes it, the IRS Forms W-2 and W-4 are different. When an employee starts a new employment, the employer completes Form W-4 to withhold taxes from the employee’s paycheck. Each year, employers submit a W-2 form to show the withholding amount. Both the IRS and workers will require Form W-2s at the end of the year to establish how much was withdrawn and if employees are qualified for a tax refund. Let us discuss the difference between w2 and w4.

W4 Forms

What You Should Know About W-2 and W-4

For your convenience, here are the main sections for the W2 vs. W4 forms.

How Are These Forms Completed?

Let us delve into the completion of four vs. two forms.

Form W-4: Every person on the organization’s payroll is required to complete a W-4 during their first month of work.

Form W-2: Annually, companies must send a W-2 form for every worker to the IRS. Additionally, by January 31, employers must give W-2 forms to their staff members. Businesses must remember to file W-2 forms for employees who receive more than $600. Whether the corporation received any Social Security, Medicare, or income tax from them is irrelevant.

What Makes These Forms Need to Be Filed?

Read on if you are wondering how to fill out the W4 form vs. W2 application.

Form W-4: According to the IRS form W-4, employees are informed of the income that should be deducted from their paychecks. The amount that will be withheld is decided by several criteria. These might include the employee’s marital status, the number of dependents, etc.

Form W-2: This record contains details regarding the employee’s pay. The employee receives gross compensation, which also includes bonuses and tips, federal tax, Social Security, and Medicare taxes. Any other deductions, including payments to retirement programs, would also appear on the W-2.

What Time Do You Need to Submit the Forms?

What is a w4 vs w2 form? How would you submit these forms?

Form W-4: Once they begin their new employment, new hires must complete a Form W-4. They must complete the form again every time their financial status changes and they require a different amount of withholding from each paycheck.

Employers are obliged to submit Form W-2 once a year. Employers have until January 31 to deliver a duplicate of the withholding record to their staff members and the IRS to report tax withholdings for the year before.

Differences between W-2 and W-4

What is the difference between w2 and w4? Read on.

The primary distinction between the W-4 and W-2 forms is who completes the paperwork and when. Employees must complete a W-4 upon accepting a new position and at any time after changing their filing status or withholding allowances. A W-2 is a record of earnings and deductions for the employee for the tax year and is completed by the company after each tax year.

The W-4 contains the employee’s name, marital status, number of dependents, and withholding allowances. In contrast, the W-2 is a reporting form used at the end of the year that includes information about the employee’s pay, tips, and other kinds of reimbursement, tax withholdings, the quantity of Medicare and Social Security taxes paid, and retirement contributions.

An employee receives a copy of the W-2 before submitting it to the Social Security Administration. No tax authority receives the W-4.

Recommendations for Small Businesses W-2 and W-4 form submission

Using these suggestions, you may precisely and efficiently fill out the W-2 and W-4 forms.

  • Effortlessly and quickly

Please ensure that you complete these forms in advance. If mistakes are made or deadlines are missed, the IRS may assess late fees for W-2s. Businesses should encourage workers to complete their W-4s before the initial day of work and submit the necessary data into the payroll system as soon as feasible. Work on your W-2s as quickly as the start of the year starts to finish them before January 31.

  • Work with an accountant.

Both forms can be challenging to understand, even with the IRS website’s detailed instructions. You can ask a company tax advisor or accountant experienced with IRS tax forms for assistance with filling out IRS tax forms. They could provide direction and aid, speeding up the process and reducing mistakes.

  • Spend money on HR or payroll software.

Using HR or payroll software with W-4 and W-2 functionality is probably the simplest method of streamlining your tax forms procedure. Your employees may complete their forms on your platform, which you may then file.

  • Think about submitting electronically.

The IRS urges you to submit the W-2 online. It is more practical and saves paper. If you save the W-4s online, you can stay organized and get to them fast.

  • There should be caution.

As with your business-related tasks, exercise extra caution when filling W-2s and assisting staff with W-4s. Spending a little extra effort up front may prevent you from unpleasant surprises down the road. Making errors on these papers might have major repercussions for your business.

The final word

Payroll tax paperwork includes the W-4 and W-2. The employee fills out the W-4, and the company completes and files the W-2. Independent contractors do not apply to these publications. After a year, the W-2 is updated with the information from the W-4 that the employee filled out. Copies are sent to the employee to help prepare their income tax return for that year after it has been submitted to the IRS.


I am a writer, financial consultant, husband, father, and avid surfer. I am also a long-time entrepreneur, investor, and trader. For almost two decades, I have worked in the financial sector, and now I focus on making money through investing in stock trading.