IRS Updates Rules and Specifications for Substitute Forms W-2 and W-3

Author: Rena Pirsos, XpertHR Legal Editor

The Internal Revenue Service (IRS) has released +Revenue Procedure 2013-18 (+2013-8 I.R.B. 503, superseding Revenue Procedure 2011-62, 2011-52 I.R.B. 1032, dated December 27, 2011 (reprinted as Publication 1141, Revised 12-2011)) updating the general rules and specifications for the preparation and use of privately printed Form W-2, Wage and Tax Statement, and Form W-3, Transmittal of Wage and Tax Statements, for wages paid during the 2012 calendar year. Substitute Forms W-2 (Copy A) and W-3 are forms that are not printed by the IRS. Copy A or any other copies of a substitute Form W-2 or a substitute Form W-3 must conform to the specifications in the revenue procedure to be acceptable to the IRS and the Social Security Administration (SSA). See Payroll > Depositing and Reporting Withheld Taxes > Form W-2 Reporting > Substitute Forms W-2 Permitted.

Employers should also refer to the 2012 General Instructions for Forms W-2 and W-3 for details on how to complete these forms. Part 3, Section 3.4, provides information on obtaining the official IRS forms and instructions. Part 2, Sections 2.3 and 3.4, provide requirements for the copies of substitute forms furnished to employees.

Note that the measurements for the 2012 Forms W-2 and W-3 exhibits have not changed from 2011, and will be posted in the 2012 revision of IRS Publication 1141, General Rules and Specifications for Private Printing of Substitute Forms W-2 and W-3.

What's New?

In addition to editorial changes, the following updates have been made:

  • The rules relating to inclusion and restriction of logos, slogans, and advertising on Form W-3, Form W-2 (Copy A), or any employee copies have been updated and clarified. Some Forms W-2 that include logos, slogans, and advertisements (including those for tax preparation software) may be confused with questionable Forms W-2 and may cause an employee to not recognize the importance of the employee copy for tax reporting purposes. Thus, the IRS has determined that logos, slogans, and advertising on Forms W-3, Copy A of Forms W-2, or any employee copies reporting wages paid during the 2012 calendar year will not be allowed, with the following exceptions:
    • Forms may include the exact name of the employer or agent, a primary trade name, trademark, service mark or symbol of the employer or agent.
    • Forms may include an embossment or watermark on the information return (and copies) that is a representation of the name, a primary trade name, trademark, service mark or symbol of the employer or agent.
    • Presentation may be in any typeface, font, stylized fashion, or print color normally used by the employer or agent, and used in a non-intrusive manner.
    • These items must not materially interfere with the ability of the recipient to recognize, understand, and use the tax information on the employee copies.
    • Corrected information on information returns and employee copies that was shown on Forms W-2 for amounts paid before January 1, 2012, is an exception.
  • The IRS e-file logo on the IRS official employee copies may be included, but it is not required on any of the substitute form copies. The information return and employee copies must clearly identify the employer's name associated with its employer identification number (EIN). Logos and slogans may be used on permissible enclosures, such as a check or account statement, other than information returns and payee copies.
  • The IRS has created a page on its website for information about Forms W-2 and W-3 and their instructions.
  • The title of the Instructions for Forms W-2 and W-3 has been changed to the "General Instructions" for Forms W-2 and W-3. These instructions now include instructions for U.S. possessions and corrected wage and tax statements.
  • The specific instructions for the checkboxes in box b, Kind of employer, of Form W-3 include examples for various types of Internal Revenue Code § 501(c) organizations.
  • The 4.2 percent rate of social security tax withholding (for employees only) is extended for wage payments made in 2012.
  • The cost of employer-sponsored health coverage must be reported in box 12 using code DD.
  • Employers must report on Form W-2 compensation of $600 or more paid to H-2A visa agricultural workers.

Forms W-2 and W-3 are subject to annual review and possible change. This revenue procedure may be revised at a future date to state other requirements of the IRS and the SSA regarding the preparation and use of substitutes for Form W-2 and Form W-3 for wages paid during the 2013 calendar year. Please continue to check XpertHR regularly for additional information on this topic.