• You need a W-2 from an employer to file your income tax.tax forms image by Chad McDermott from Fotolia.com
  
  The W-2 is a wage and tax statement issued by the Internal Revenue Service. The form is sent by employers to employees prior to Jan. 31 and documents all wages, salaries and other compensation paid to employees by the employer for the previous tax year. The form also documents all taxes that have been withheld by the employer. The IRS has specific W-2 requirements for both employers and employees.
  
  

Instructions for Employers

• The IRS requires the employer to issue six copies of the W-2 form. These copies are labeled Copy A-D and Copy 1-2. Copy A is submitted to the Social Security Administration along with Form W-3 summarizing all W-2s completed by the employer. Copy B is sent to the employee so he can submit the form with his federal income tax return. Copy C is also sent to the employee for his records. Form D is retained for the employer's records. Copy 1 is submitted to the employee's local or state taxing authority if this is required by state or local law. Finally, Copy 2 is sent to the employee so he can submit the form with his state or local income tax return.
  
  

Instructions for Employees

• The W-2 form consists of boxes labeled a-f and 1-20. The most important boxes for the employee are Nos. 1 and 2. The amounts from these boxes are needed to properly prepare the employee's income tax return. Box 1 is the amount of wages paid to the employee. The employee should enter this amount on the wage line of his tax return. Box 2 is the amount of federal income tax withheld by the employer. The remaining boxes list other types of compensation and withholding from the employer over the tax year. Boxes a-f list identifying information about the employee and employer.
  
  After receiving the W-2 from the employer, the employee should always verify that all information is correct and should immediately notify the employer if there are any mistakes.
  
  

Use of Form W-4 for Preperation of W-2

• The W-4 is the IRS tax form used by employers to determine the correct amount of withholding from employees' pay. An employer cannot properly complete a W-2 without first having an employee complete a W-4. The employee uses the W-4 to determine the amount of allowances she will claim for the tax year. The W-4 should be based on the employee's earnings expectations for the tax year. The fewer allowances an employee takes on her W-4, the more federal income tax is withheld by the employer.