Higher Penalty Amounts If IRS Finds Problems With Your W-2s

Learning that a Form W-2 contains errors is bad enough, but being assessed a penalty by the IRS is even worse.

Errors can show up in many ways. For example, employers might enter incorrect information, such as the amount of income tax withheld, or not include all the required data on the forms.

Or employers might fail to file the forms by the IRS due date — and that can lead to penalties, too.

Bear in mind, any penalties apply on a per-return basis. Here are the latest amounts released by the IRS.

IRS Increases the Amounts

For employers with gross receipts of $5 million or less, maximum penalties reach over $1 million.

For failure to file or furnish correct Forms W-2 that are corrected on or before 30 days after the required filing date, the TY 2024 and 2025 penalties are:

• $60, with a maximum of $232,500, and
• $60, with a maximum of $239,000.

If the forms are corrected after the 30th day but on or before August 1, the TY 2024 and 2025 penalties are:

• $130, with a maximum of $664,500, and
• $130, with a maximum of $683,000.

For failure to file after August 1 or not filing corrections, the TY 2024 and 2025 penalties are:

• $330, with a maximum of $1,329,000, and
• $340, with a maximum of $1,366,000.

For employers with gross receipts over $5 million, maximum penalties reach over $4 million.

For failure to file or furnish correct Forms W-2 that are corrected on or before 30 days after the required filing date, the TY 2024 and 2025 penalties are:

• $60, with a maximum of $664,500, and
• $60, with a maximum of $683,000.

If the forms are corrected after the 30th day but on or before August 1, the TY 2024 and 2025 penalties are:

• $130, with a maximum of $1,993,500, and
• $130, with a maximum of $2,049,000.

For failure to file after August 1 or not filing corrections, the TY 2024 and 2025 penalties are:

• $330, with a maximum of $3,987,000, and
• $340, with a maximum of $4,098,500.

Intentional Disregard

The amount a company has to pay can go even higher if the IRS determines that the business has intentionally disregarded its responsibility for file Form W-2.

For tax year 2024, that amount starts at $660, and for tax year 2025, it starts at $680.

And beware: There’s no maximum.