Payroll

Penalty amounts climbing for errors related to Form W-2, IRS says

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Last Updated: December 6, 2023

2 minute engagement

How much will employers have to pay for any penalties related to tax year 2023 forms, including W-2s and other information returns?

We’ll review those numbers and also take a look at the numbers IRS recently released for tax year 2024 forms, as found in Revenue Procedure 2023-34.

Here are the situations that can lead to penalties, along with the per-return penalty amounts and maximums that can be assessed per year, for TY 2023 and 2024, respectively.

The cost of W-2 mistakes

Situation #1 – You have gross receipts over $5M, you fail to file or furnish a correct information return and a general penalty is assessed:

$310, with a max of $3,783,000
$330, with a max of $3,987,000

Situation #2 – You have gross receipts over $5M, you fail to file or furnish a correct information return and you fix the error on or before 30 days after the required filing date:

$60, with a max of $630,500
$60, with a max of $664,500

Situation #3 – You have gross receipts over $5M, you fail to file or furnish a correct information return and you fix the error after the 30th day but on or before August 1:

$120, with a max of $1,891,500
$130, with a max of $1,993,500

Situation #4 – You have gross receipts of $5M or less, you fail to file or furnish a correct information return and a general penalty is assessed:

$310, with a max of $1,261,000
$330, with a max of $1,329,000

Situation #5 – You have gross receipts of $5M or less, you fail to file or furnish a correct information return and you fix the error on or before 30 days after the required filing date:

$60, with a max of $220,500
$60, with a max of $232,500

Situation #6 – You have gross receipts of $5M or less, you fail to file or furnish a correct information return and you fix the error after the 30th day but on or before August 1: