Tax season is nearing, which means W-2 forms will be coming soon from your employer. Your W-2 form contains key information that will help you fill out your tax return. It also decides whether you will receive a refund or have to pay the IRS. Some of the numbers can help you improve your future tax planning too.
Today, we are discussing three of the numbers that you need to make sure are correct on your W-2 form.
Three Key Numbers to Check on Your W2 Form
Box 1 – Your Total Pay
This is one of the most important boxes on your W-2. It shows you your total amount of taxable income. It will be higher than the amount of money that you took home throughout the year if you have taxes withheld from your paycheck. However, it does not include some of the important benefits that allow you to qualify for special tax treatment.
Box 2 – Federal Income Tax Withheld
This box will allow you to determine whether you need to pay the IRS or whether they will be sending you a refund. If your tax withholding forms were filled out correctly, the number here should be close to your tax liability amount. If it is not, you need to go to the HR department at your place of employment and complete a new Form W-4. By doing so your number can be more accurate.
Box 12 – Special Benefits
This box will include all of the tax breaks you are entitled to. All of the things that usually are taxable wages will convert to pre-tax piggybanks such as 401 (k) retirement plans and flexible spending accounts. The more you have listed, the more you save on taxes, which means you should take advantage of everything your employer offers.
TurboTax is loyal to their customers and treat them as if they are not just another number.
Their online filing services has the ability to import your W2 information into your tax return so you can avoid worrying about your forms being delivered via snail mail. Their tax estimator can show you much you’ll be getting back this year in your IRS tax refund.