Glossary of Human Resources Management and Employee Benefit Terms
Form W-3 is a tax form used by employers to report combined employee income to the Internal Revenue Service (IRS) and the Social Security Administration. Employers who send out more than one Form W-2 to employees must complete and send this form to summarize their total salary payment and withholding amounts. Employers who send out a single Form W-2 do not need a separate form to tally the total amounts, as they’re displayed on their single employee’s Form W-2.
Every employer required to file a Form W-2 must file Form W-3. This translates to most employers in the U.S., as Form W-2 is required after paying an employee more than $600 in wages in a given year, whether or not the employer withholds income or taxes from an employee’s wages.
Form W-3 provides a benchmark for the IRS to compare figures from individual employees’ W-2 forms with the official totals reported by their employer.
Your business details, including employer identification number (EIN), legal address, and other contact information
Total wages (salary, tips, commission, and other compensation) paid to employees over the prior year
Total taxable wages for Social Security and Medicare
Total federal and state income tax withheld
Total Social Security tax withheld
Total Medicare tax withheld
Employers are required to submit Form W-3 by January 31 each year—a shared deadline with mailing employees their copies of their Form W-2.
The preferred method is to submit wage files from your payroll software through the Business Services Online (or BSO) portal. The IRS and the Social Security Administration are phasing out their paper copy method with stricter regulations on who is eligible to file by mail.