Accounting Best Practices, Fifth Edition

17–13. Outsource W-2 Form Creation and Delivery

Shortly after year-end, the payroll department comes under pressure from those employees who suspect they have a tax refund coming, and want their W-2 forms as soon as possible in order to obtain the refund. However, and especially in larger companies with thousands of employees, printing and mailing W-2 forms can be a major chore that tends to be delayed. Also, some employees inevitably lose their W-2 forms, resulting in more work by the payroll staff in reissuing replacement forms.

A cost-effective solution for larger companies is to send their W-2 data by a data feed to the W-2 eXpress product of TALX (www.talx.com), which can issue electronic or faxed W-2 forms to those employees who opt for this service, or issue traditional paper-based W-2 forms to all remaining employees. Under the electronic delivery approach, employees can access the supplier’s Web site, enter their social security number and a PIN, and have immediate access to their W-2 forms for the past four years in PDF format. It is also possible for employees to download W-2 information directly into some of the more common tax filing software packages.

If W-2 information is incorrect, the service also allows for either subsequent data feeds containing W-2c information, or on-line manual updates to the previously submitted information.

This approach also allows the payroll manager to monitor employee W-2 usage, as well as call up copies of W-2 forms for individual ...