Tax Guide |
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For the most part, employees have it very easy when it comes to reporting their taxable earnings.
They simply look at the W-2 forms they've received from their employers, take the number in Box 1 of the W-2, and report it on Line 1 of Form 1040EZ, or Line 7 of Form 1040A or Form 1040.
If they had more than one job during the year, or they are filing jointly with a spouse, they must add up all the numbers in Box 1 from all the W-2s that they (and their spouse) received, and report the total on the line for wages, salaries and tips, etc.
There are numerous types of employee benefits that are exempt from federal income tax. For example, health and accident insurance, qualified retirement plan contributions, certain types of education assistance, reimbursements for business expenses, qualified transportation benefits, and group-term life insurance premiums for up to $50,000 of coverage can all be excluded if certain conditions are met. However, it will be up to your employer to determine whether or not you've received nontaxable benefits, to determine the appropriate value of the benefits, and to adjust your taxable earnings amount accordingly so that only the taxable amount is reported in Box 1.
Your employer must give you a W-2 Form by January 31, 2015, to report all taxable salary, tips, wages and other compensation earned in 2014. A copy of each W-2 you (or your spouse, if filing jointly) receive must be attached to your tax form.
If the employer makes a mistake in these calculations, you must inform the employer and ask for a corrected Form W-2. Employers send a copy of all W-2s directly to the government, and if your reported income does not match what the employer has reported, you may get a letter from the IRS asking for more tax money, plus interest, and penalties.
If you don't receive a W-2 at all, you should contact the employer to find out why not, and ask that one be sent to you. If this doesn't work and by February 15th you still haven't received a W-2, call the IRS at 1-800-TAX-1040 to ask them to help you fill out a copy of Form 4852, Substitute for Form W-2.
Special rules apply to:
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