5 W-2 Tips from Payroll Pros to Put More Money in Your Pocket
SAN ANTONIO, Jan. 19, 2012 /PRNewswire/ -- One of the most important tax forms you will receive this year is Form W-2, Wage and Tax Statement. Your 2011 income taxes and social security benefits in the future are based on this form, so its accuracy is essential to both your short- and long-term financial health.
The American Payroll Association, the nation's leader in payroll education, offers tips to get the most from your Form W-2.
1. Make sure you receive all your W-2s. You should receive a Form W-2 from every company you worked for in 2011 by January 31. If one of the companies does not send one, contact its payroll department and request a 'reissued statement.'
If you earned $600 or more from a single company for freelance or contract work, you should receive Form 1099-MISC, Miscellaneous Income, instead of Form W-2 by January 31.
2. Verify your Social Security Number (SSN) matches your social security card. The name and SSN on Form W-2 must match your social security card in order for you to receive your social security benefits. Ask your payroll department for a corrected Form W-2, if needed.
3. Review your Form W-2 against your final 2011 paystub. Contact your payroll department if any figures seem incorrect.
Important items to review on Form W-2:
A. Box 1 will differ from your final 2011 paystub year-to-date gross pay if you participated in a 401(k) or other employer-sponsored savings plan.
B. The Box 3 total should not exceed $106,800 – the 2011 social security wage base.
C. Boxes 1, 3, and 5 will be different from your final 2011 paystub year-to-date gross pay if you use pre-tax dollars to pay insurance premiums or to contribute to flexible spending accounts.
4. Check for tax credits. You may be eligible for thousands of dollars from the Earned Income Tax Credit. Read the back of Form W-2 copies B, C, and 2 to determine your eligibility.
5. Give yourself an instant raise! The average person overpays their taxes by $250 a month. Download the free Paycheck Maximizer smartphone app to adjust your Form W-4 to closer match your tax liability. You could increase the money you receive in each paycheck.
For additional tips or to download the Paycheck Maximizer app, visit www.nationalpayrollweek.com.
SOURCE American Payroll Association