Pay stubs online come with a lot of benefits. You can show them at any desk and they are accepted as an authentic earning statement by all. They get you an instant loan and credit approvals and offer more perks which you cannot expect from traditional methods.
While you are making free check stubs, you should know that it can help you in calculating W2 Forms too. If you are the one who is eager to know how W2 forms online can be created using paystubs then this blog is for you.
Pay Stubs Online & W2 Forms
Pay stubs online and W2 forms have a lot to do together. As you know, you have to file a W2 Forms are nothing but Wage and Tax Statement provided to employees by employers for completing their tax returns. Here, online pay stubs form the base on which W2 forms can actually be created.
Alert! Don’t ever jump for fake paychecks even during the last minute because using online pay stubs is always a better idea over them. Here’s why!
Kindly note that the accuracy of pay stubs is very important. Don’t worry if you create pay stub for free but be concerned with the quality you receive in the check stub. As it forms the basis for W2 forms, if it is not precise, the legal documents which take it as a base will also produce false information. This can later lead to penalties. In order to save yourself from indulging in such activities, pick the best pay stub generator.
How to use Online Pay Stubs for W2 Forms?
As an employer, you will have to dispatch online pay stubs to your employees so they can handle tax returns smoothly. Generally, the pay stub comes with all the information you need for calculations and to create W2 forms. It shows details on take-home pay and deductions like federal taxes, medical aid, and social security and state taxes.
Here are a few simple things which you need to consider for calculating W2 Forms:
Determining Taxable Income
Gross Pay is the most critical thing which is used to calculate pay stub and hence forms the basis for W2. Get the total of overtime hours, commissions and bonuses for a particular pay period. Sum up your gross earnings which are the total before any kind of deductions, contributions and taxes are withdrawn.
Things to Keep in Mind
Personal exemptions and expenses throughout the year strongly influence tax returns. Federal and state taxable income which is taken into account differs based on the specific situation. If you have any additional personal exemptions then you should consider them accordingly.
What if you don’t file a W2 form?
If in case you forget to file a W2 form, you will still receive a return. Well, if you don’t pay the taxes on time then you owe additional taxes and amendments which are required to be paid by April 15. Still, if you don’t do this then you are liable to penalties.
The amended return must be paid within the duration of three years from the date of filing the original returns. You may file it within 2 years from the date you have paid your tax. Any closer date can be chosen accordingly.
