SAN ANTONIO, Jan. 22, 2016 /PRNewswire/ -- One of the most important forms for employees' taxes and future social security benefits is Form W-2, Wage and Tax Statement. Once received, review the document carefully to avoid suffering tax penalties and to maximize your tax refund.
The American Payroll Association, the nation's leader in payroll education, has five easy tips to ensure you get the most out of your Form W-2 and ensure its accuracy.
1. Verify you have received all of your W-2s. Make sure to obtain a Form W-2 from every company you received compensation from during 2015. If you don't receive your W-2 a few days after February 1, contact the company's payroll department to request a 'reissued statement.'
If you earned $600 or more from a single company for freelance or contract work, you need the Form 1099-MISC, Miscellaneous Income, instead of Form W-2.
2. Verify your Social Security Number (SSN) matches your social security card. Your name and SSN on Form W-2 must match your social security card to receive the social security benefits to which you are entitled. If they do not match, ask your payroll department for a corrected Form W-2.
3. Review your Form W-2 against your final 2015 paystub. Contact your payroll department immediately if you notice any discrepancies.
Important items to review on Form W-2:
A. Box 1 will differ from your final 2015 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 $118,500 – the 2015 social security wage base.
C. Boxes 1, 3, and 5 will be different from your final 2015 paystub year-to-date gross pay if you use pre-tax dollars to pay insurance premiums or for transit benefits, or to contribute to flexible spending accounts.
4. Check for tax credits. Depending on your eligibility, you may qualify for thousands of dollars from the Earned Income Tax Credit. Read the back of Form W-2 copy B to determine your eligibility.
5. Give yourself an instant raise! If you are getting a refund of more than $1,000, adjust your Form W-4 to closer match your tax liability. By updating this information, you can give yourself an instant raise.
For additional tips and resources, visit www.nationalpayrollweek.com.
SOURCE American Payroll Association