Also known as a W-2 or wage statement. A statement of the wages, salary, tips, and other taxable income (including, for example, income from the exercise of stock options or vesting of restricted stock) paid to an employee and the taxes withheld during a calendar year.

An employer must issue an IRS Form W-2 to each employee by the deadline set by the Internal Revenue Service. Copies of the IRS Form W-2s for all employees, plus a consolidated report on IRS Form W-3 must be sent to the Social Security Administration each year.

The employer must report on IRS Form W-2 any deferred compensation that becomes taxable because of a violation of Section 409A of the Internal Revenue Code. For more information regarding employer withholding and reporting requirements under Section 409A, see Practice Note, Section 409A: Deferred Compensation Tax Rules: Overview: Employer Reporting and Withholding Requirements.

Under the Affordable Care Act (ACA), employers must also report the cost of employer-sponsored health coverage on IRS Form W-2s. The reporting requirement applied starting with Form W-2s reporting 2012 compensation. For a discussion of the ACA's tax reporting requirements, see Practice Note, W-2 Reporting for Employer-Sponsored Health Coverage.