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5 Min. Read

What is a W3 Tax Form and How to File One

What is a W-3 Form? Informative Guide & Tips (2021)

Most small business owners know what W-2 forms are, but what about a W-3 form?

Until youā€™ve hired your first employee, you likely have never needed a W-3 form. The good news is that if youā€™re familiar with W-2s, understanding a W-3 form is quite simple.

In this post, we’ll walk you through the most common questions employers have regarding W-3 forms, including how it differs from W-2s. Weā€™ll also show you multiple ways to file a W-3 form so you can choose which is best for you.

Hereā€™s What Weā€™ll Cover:

What Is a W-3 Form?

Form W-3 Vs. Form W-2: How Do They Differ?

Who Files a Form W-3?

How to File a W-3 Form

Streamline Your Small Business Taxes

More Resources on Small Business Accounting

What Is a W-3 Form?

A W-3 form, also called the Transmittal of Wage and Tax Statements form, is a summary of all of a business’ employee wages and contributions for the previous tax year. This form is sent to the Social Security Administration(SSA) for proper filing.

Form W-3 Vs. Form W-2: How Do They Differ?

All the ā€œWā€ IRS forms (W-2s, W-3s, W-4s, etc.) sound similar and are commonly confused, but one that’s commonly mixed up is IRS Form W-3 and IRS Form W-2, and rightly so. Both report very similar information about employees.

Form W-3 verifies employee information and business information reported on the W-2 forms of your employees. For example:

  • Employee wages
  • Federal income tax information
  • Medicare and social security tax withholdings
  • State income tax information
  • Employer identification number
  • Business contact information like email address

Form W-3 aggregates the information of numerous employees and their W-2 forms and reports it as one. This means each employee fills one Form W-2, whereas an employer fills Form W-3 once for multiple employees.

Who Files a Form W-3?

Employers filing at least one W-2 form for their employees must file a W-3 form.

How to File a W-3 Form

You have a few options when it comes to completing Form W-3:

  • File online with Business Services Online (BSO)
  • Use payroll or tax software
  • Mail Form W-3 and W-2 forms

File Online With BSO

BSO automatically pre-fills IRS W-3 forms based on submitted Form W-2 data. Optimal for less than 50 employees.

  1. Register for BSO using information like your email address
  2. Create and submit up to 50 W-2 forms
  3. Double-check pre-filled Form W-3 information

Use Payroll or Tax Software

If you have more than 50 employees or 50 W-2 forms, you can use specific payroll software or taxes software to  ā€œfile uploadā€ multiple W-2 wage and tax forms unto BSO. Format has to meet certain SSA specifications.

Mail Form W-3

When filing Form W-3 with a physical Form W-3, people get confused with boxes A-B. Letā€™s break it down.

Box A

  • (Optional) Control number. A control number helps a business with over one Form W-3 and over 50 employees. It helps tie Form W-2 of specific individuals to the particular Form W-3.

Box B

  • Kind of Payer Employers who filed form 944 can choose 944. Otherwise, youā€™ll likely select 941.
  • Kind of employer: Unless you’re a non-profit organization or federal government business, you’ll check “none apply”.

The rest is mostly copying data from W-2 forms to Form W-3.

Once finished, attach Copy A of each employee’s Form W-2 to Form W-3. Itā€™s a common error to print and file Copy A of Form W-2 and Form W-3 from the IRS website. Instead,  find approved red-ink versions of IRS Form W-3 and Form W-2 on IRSā€™s products page.

A business using paper forms would file Form W-3 by sending it to:

Social Security Administration

Direct Operations Center

Wilkes-Barre, PA 18769-0001 ( or ā€œ18769-0002.ā€ if you use ā€œCertified Mailā€ )

Using an IRS-approved private delivery service?

Add ā€œATTN: W-2 Process, 1150 E. Mountain Dr.ā€ and change ā€œ18769-0001ā€ to ā€œ18702-7997.ā€

Reporting to the Social Security Administration (SSA)

Form W-3 is always sent to the Social Security Administration, who then forwards it to the IRS.

Other times youā€™ll need a copy of Form W-3 while filing it with your state government and for the Covid-19 Paycheck Protection Program.

Do I Need to File Form W-3 C Too?

You only have to file Form W-3 C (Transmittal of Corrected Wage and Tax Statements form) if the original W-3 form(Transmittal of Wage and Tax Statements form) had an error.

Streamline Your Small Business Taxes

Correctly filing a tax form like Form W-3 and IRS W-2 forms is easy but time-consuming.

Finance software helps you spend less time crunching numbers and more time doing what you love.

Thatā€™s why we seamlessly integrate with payroll software which decreases the time needed on paperwork like Form W-2 and Form W-3. Payroll software not only simplifies the process of filing tax forms but also assists in managing tax deductions for W-2 employees efficiently. It can even generate and submit IRS W-2 forms and W-3 forms for you.

Step-by-step guide: Easily integrate payroll software with FreshBooks.

More Resources on Small Business Accounting


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