Facts About Your W-2 Form

Unless under a contractor/employer relationship, everyone working a job in the United States should receive a W-2 form from their employer(s) each year. This is an important tax document that helps ensure you file an accurate tax return, so you pay only what you owe or receive a correct tax refund.  If you fail to provide all of your W-2 form(s) when filing your taxes, you not only potentially cause yourself the frustration of making corrections later, but potentially lose credits for which you may qualify by filing all W-2’s completely and timely.

Put simply, your W-2 is a form generated by your employer, and a document required by the IRS as a means of reporting your wage and salary information. This will also clearly set forth the amount of state, federal, and any other deductions taken from your pay. Additional information found on the form includes Federal taxable earnings, Social Security earnings, and your Medicare earnings, should you have any of these.

The Form W-2 is generated by your employer. Every January, you will receive a W-2 from each employer you had during the previous year.

Exempt Vs. Non-Exempt

According to The Fair Labor Standards Act (FLSA), it is required that most employees be paid, at the very least, the federal minimum wage for all hours worked.  If hours should exceed 40 per week, time and one-half must be paid as overtime to that employee. The FLSA also provides an exemption from both overtime and minimum wage pay for employees who are employed as bona fide administrative, professional, executive, and outside sales employees. This section, 13(a)(1), as well as section 13(a)(7), also exempts certain computer employees, and you must meet highly specific job duties and salary requirements before you are eligible.

One of the biggest differences between an exempt employee and one who is not is how they are compensated. Employees who are exempt, are exempt from the FLSA regulations put in place to govern overtime pay and minimum wage, and job titles alone do not determine exempt status. Exempt employees may be expected to work their assigned job duties without added compensation, even if that means going to work early or staying late.

If you do not fall under the exemption, you must by federal law receive the existing federal minimum wage rate for the first 40 hours of work done. After that, you must receive no less than time and one-half for every additional hour worked, and are paid by the hour rather than paid a set salary. This difference is distinctive, since an exempt employee will receive their full pay every pay period, while a non-exempt employee will be paid only for actual hours worked.

New Changes

The Department of Labor (DOL) published a Request for Information on July 26, 2017, defining and delimiting the exemptions for computer, executive, professional, and administrative employees. This presented an opportunity for the DOL to revise these regulations, and employers were given the opportunity to provide input on questions stated in the request for information.