What is the purpose of a W-2 form?

The W-2 form serves a critical function in the context of employment and taxation. Its primary purpose is to summarize an employee's annual wages, as well as the federal, state, and other taxes withheld by the employer during the tax year. The information provided on the W-2 is essential for employees when they prepare their annual tax returns, as it details both their earnings and their tax withholdings.

This report includes important data such as the total wages earned over the year, Social Security and Medicare taxes withheld, and any other deductions or contributions made, such as retirement plans. The accuracy of this form is crucial because it directly impacts the employee's tax liability or the refund they might receive.

In contrast, other forms mentioned are used for different purposes, such as self-employment income or business profit calculations, and are not specifically tailored to document wage and tax information for employees. Therefore, the W-2 form is an essential document for employees to ensure compliance with tax regulations and to facilitate the correct calculation of their personal tax obligations.