Do I Have To File All My W2S If I Have Multiple W-2S?

There may be situations where you have more than one W-2. So, you may find yourself asking, "Do I have to file all my W2s?" The simple answer is yes. Every Wage and Tax Statement received by employees contributes to their total annual income. So they must be reported on your tax return. 

What happens if you don't file all your W2s? This is risky because the IRS notices, you face a higher tax liability with penalties, and the tax refund may be delayed or adjusted. One way to create employee W-2s and pay stubs online is to use a W2 and paystub generator.

This article helps you understand what to do when you have more than one W2. If you're asking, "What happens if I only file one W2?" We'll explain the steps to fix this error and best practices to follow.

Understanding Your W-2: The Wage and Tax Statement

The W-2 form, or Wage and Tax Statement, is an official document that an employer provides every January. It summarizes employees' annual earnings and the amount of taxes withheld from their paychecks for the previous year.

Usually, employers are required to send copies of this form to their employees, the Social Security Administration (SSA), and the Internal Revenue Service (IRS). So, this means that the IRS already has a record of your income and withholding. After filing a tax return, the IRS's automated systems compare the information submitted with the data received from employers.

Read more:W2 Vs W9 Form: Key Differences To Understand As A Worker.

Do I Have To File All My W2s at the Same Time?

The Internal Revenue Service (IRS) requires employees to report all taxable income earned during the year. Each Form W-2 documents the wages earned and the taxes withheld from a specific employer. Omitting any of them means that you aren't reporting your full income. The law requires this, so it's necessary.

Many employees also want to know, "Do you have to file all W2s at the same time?" or "Can I file one W2 now and another later?" As it is, employees cannot file separate returns for each W-2. They must submit at once. All forms must be compiled and then reported together on a single return. It doesn't matter if they're using e-file or mail paper forms; it has to be on a single return.

Why You May Have Multiple W-2 Forms 

In cases where an employee finds out that they were issued multiple W-2s, it doesn't happen by mistake. There can be different reasons why this could happen. And it's important to understand every possible reason. Here are some situations that may lead to employees having multiple W-2s:

1. You Changed Your Job Within the Year: This is usually one of the most common reasons for having multiple W-2s. Every employer has to provide a W-2 for the year worked, even if an employee leaves during the year. If they switch companies, they'll have to receive W-2s from each employer. They are therefore both mandatory for tax filing.

2. You Worked Multiple Jobs: A worker may work different part-time jobs, or may have a full-time job and a side job. This means that each employer will issue a separate W-2 to that particular employee. Each form represents a portion of their total earnings.

3. You Received a Corrected W-2 (Form W-2c): If an employer finds an error in their employee's original W-2, they are required to issue a Form W-2c. It's the IRS form for incorrect wages or withholding. They will have to use this corrected form when filing.

4. Changes at Your Company: A company may have changed its payroll service provider, used multiple Employer Identification Numbers (EINs), or changed ownership. In cases like these, an employee may receive more than one W-2 from the same business.

Also check:Generate your pay stubs using our accurate AI pay stub generator.

What Happens If You Don't File All Your W2s?

So, what happens if you don't file one of your W2s? Initially, your tax return might be accepted, therefore receiving a refund based on the income reported. However, this may only be temporary. The IRS would eventually find that there's an error somewhere. The IRS's Automated Underreporter (AUR) system catches this error between your filed income and the data received from employers. Even if you don't remember later that you forgot to file a W-2, the IRS can contact you.

When this happens, the employee will most likely receive a CP2000 notice that they can use to adjust their tax liability. This notice includes any additional tax owed, plus interest and possible penalties.

Will I still get my tax refund if I forgot a W2? Yes, it's just that it may be delayed or adjusted. If the IRS flags your return before issuing a refund, they will hold it until the issue is resolved.

Read more: How To Get Pay Stubs From Previous Employer (A Complete Guide)

What To Do if You Filed Only One W-2 Form

When you have multiple W-2s and realize that you filed only one of them, it's possible to fix this mistake. In a case like this, here's what to do:

1. Do Not File a Second Original Return

Once the return has been submitted already, don't try to send another one with the missing W-2. The IRS system will simply reject it as a duplicate.

2. File an Amended Return Using Form 1040-X

Next is to file an amended return using a Form 1040-X, which is the Amended U.S. Individual Income Tax Return. This amended return is the official document that's used to correct a previous tax return. Use it to report the additional income and taxes withheld that were from the omitted W-2.

Employees will need to file an amended form if they don't file all their W-2s. The process of filing this form includes:

1. Wait for Processing: Make sure that the IRS fully processes the initial tax return. They must do this before you file the amendment.

2. Obtain the Form: Download the IRS form from the IRS website.

3. Complete the Form: Fill out the form correctly by entering the correct information on the form after including the missing W-2. The employee should include details about their total income, deductions, and credits. There's a section to also include the original numbers, one for the net changes, and another for the correct numbers.

4. Attach Documents: A copy of the previously omitted W-2 form is to be attached while filing the Form 1040-X.

5. Submit Your Amendment: Now, you can e-file the Form 1040-X through any tax software. It also works by mailing the form directly to the IRS.

3. Pay Any Resulting Balances and Penalties Immediately

The amended return will recalculate your total tax liability. If you owe more, pay the balance immediately to stop interest. The IRS notice will outline any applicable penalties.

Also check: Pay stub templates to create accurate pay stubs online.

Not Filing All W-2s: How This Impacts Your Tax Refund and Balances Due

Apart from just facing W2 penalties from the IRS for not filing all, it also directly impacts refunds and balances:

• If You Owe More Taxes: If there are additional income increases on an employee's total tax liability, this could be a problem. They will most likely owe the difference, plus interest.

• If You Get a Larger Refund: In cases where there is an extra withholding of taxes in your W-2 form, you may be eligible for a larger refund. However, this will require an amended tax return.

• Delay of Refund: In addition to this, if the IRS finds out about the missing form, they will hold your entire refund.

How Multiple W-2s Affect Your Withholding and Tax Bracket

When an individual has multiple jobs, each of their employers withholds their taxes based only on the income earned from them. The employee's combined income from all W-2s may push them into a higher tax bracket. And this means that their total withholding from all jobs may not be enough. This is why it's very important to review W-4 forms with each employer if you're working multiple jobs.

Financial Penalties for Filing One Out of Multiple W2s

The most common penalty for filing just one W2 is that it may lead to an underpayment of tax penalty. If omitting a W-2 results in a lower tax payment than what is owed, the IRS charges a penalty for underpayment:

• Amount: 0.5% of the unpaid tax for each month the tax remains unpaid, capped at 25% of the unpaid tax.

• Interest: Interest accrues on unpaid tax and penalties. Currently, it's at 7% per year, and it's usually compounded daily.

For an accuracy-related penalty, if the missing W-2 leads to a "Substantial understatement" of your income tax, the employee may be charged. This is an understatement of tax by 10% or more, or $5,000 (whichever is greater). The amount of this accuracy-related penalty is 20% of the portion of the underpayment. It's attributable to negligence or disregard of rules. 

There's also a failure-to-file penalty for situations where no return was filed. The amount for this is 5% of the unpaid tax for each month the return is late, up to 25%.

If the return is more than 60 days late, the penalty is the lesser of $525 or 100% of the unpaid tax. 

Tax Filing Best Practices When You Have Multiple W-2 Forms

If possible, it's always better to avoid stress by simply filing your multiple W-2 forms. Here are a few important tips to follow if you have multiple W2s: 

1. Organize Your Tax Documents

As soon as W-2s come in January, try to make a file for them. Put all the forms in this file. This way, different forms won't get lost in the mailbox or even in digital files.

2. Use a Tax Software or the IRS Free File Program 

There are different software programs that are made for multiple jobs. They will ask you to "Add another W-2," so you can enter all the correct information and avoid errors.

3. Verify All Information Before You Submit

On your W-2, make sure you double-check the Social Security number, name, and income on each W-2. Add up the totals against what's on your final pay stubs. If there's something missing or incorrect, ask the employer for a corrected form.

4. Consider Professional Help

If you need further help, it's also a good idea to consult a tax professional. A Certified Public Accountant (CPA) may assist in providing support in order to help employees get it correctly.

Special Case: If You Are a Dependent

"What happens if I am a dependent filing taxes and only file one of my 2 W2s?" The rules are the same. The dependent has to report all income. The IRS does not make exceptions for age or being a dependent. The same process for filing an amended return applies.

Further reading: How To Spot A Fake W2 Form And What To Do If You Receive One

Closing Thoughts

So if you ask, "Do I have to file all my W2s?" Yes, you do. Filing W2 forms is common for employees. Many employees will have to file multiple W-2s because they have multiple jobs or have switched companies. If you have multiple forms and forgot one, there are solutions to fix this. You'll need to file an amended return and pay any tax penalties.

Do you have W2 employees? Employers can create W2 forms with our W2 generator. This is so that they don't have to make filing taxes stressful for their employees. If you also need to create your pay stubs on your own, try our online paystubs maker.