What Happens If You Don’t Make The W-2 Deadline for Employees
Late W-2 submissions can be costly, on top of causing frustration and dissatisfaction among your employees. In a recent article, Chron reviews some of the consequences faced by businesses for missing their W-2 deadlines, while offering advice on what to do to minimize these in the event that a missed deadline is unavoidable – here are some of the key points to consider:
W-2 forms derived from the previous calendar year should be mailed out before or on 31 January. Employees who were expecting a tax return may be especially frustrated by receiving their W-2 forms too late. If the IRS receives multiple complaints from employees from the same organization, they may launch a further investigation, which may put unwanted pressure on a business.
Companies that are found guilty of not sticking to the mandated deadline could incur hefty fines:
• W-2s filed within 30 days of due date face a penalty of $50 per form; small businesses are liable to pay up to a maximum of $187 500 in penalty fees.
• W-2s filed before 1 August face a penalty of up to $100 per form and a maximum fine of $536 000.
• W-2 forms filed after 1 August face a penalty of $260 per form and a maximum fine of $1 072 500.
Some employee retention and employee communication tips to bear in mind, in addition to remembering to send out W-2s on time:
1. Ensure that W-2 forms reflect the correct information, and keep records. An employee has the right to sue a company for damages in the event that an incorrect salary is reported to the IRS. Inaccurate information may result in fines of $530 per form, in addition to $5000 in damages and possible criminal charges.
Ezzely’s document upload functionality allows employees to upload important documentation or information in order to assist companies in easily and conveniently keeping their employee records, such as their addresses for sending a W-2, up to date. Note: If an employee’s W-2 is ever returned due to an incorrect address, file it (unopened) in their employee file, should they ever contact you about it at a later stage – it serves as proof that you did indeed send it out, thus safeguarding you from a potential fine.
2. Communicate with your employees about possible delays. If you’re running late with sending out W-2s, it’s a good idea to communicate the delay with your employees – a message from you could go a long way in assuaging frustration. Ezzely, an employee retention app and employee engagement app, could help:
• Send out a company-wide notification using the Ezzely Activity Feed to request that employees keep their address information updated to avoid having their W-2s returned; or
• Let everyone know that the company is running late, why this is the case, and what the company is doing to ensure that the forms are sent out as soon as possible.
These actions will ensure that employees remain satisfied with the company’s efforts, that employee engagement does not suffer as a result, and that they won’t seek greener pasturesof a more reliable nature.
Employee retention apps and employee engagement platform can be used creatively to ensure that your company’s needs for communication, engagement, information and recognition are met. Ezzely provides a multi-faceted and multi-functional platform – and you can decide how best to employ it to serve your needs.