Publication 80 - Federal Tax Guide (Circular Ss) - Internal Revenue Service - 2012 Page 6
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employee may show the card if it is available. Do not
Name.
accept a social security card that says “Not valid for em-
•
SSN.
ployment.” A social security number issued with this leg-
•
end does not permit employment. You may, but you are
Date of birth.
not required to, photocopy the social security card if the
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Type of employer.
employee provides it. If an employee does not have a
•
social security card or needs a new one, the employee
Employer identification number (EIN).
should apply for one on Form SS-5, Application for a Social
•
Company name, address, and telephone number.
Security Card, and submit the necessary documentation.
•
See the back cover of this publication for information on
Email address.
how to get and where to send the form. The employee
When you have completed the online registration pro-
must complete and sign Form SS-5; it cannot be filed by
the employer. If your employee has applied for an SSN but
cess, the SSA will mail a one-time activation code to your
employer. You must enter the activation code online to use
has not received the card before you must file your Form
SSNVS or TNEV.
W-2 reports, and you are filing your reports on paper, enter
“Applied For” in box d. Enter all zeroes in the SSN block if
filing electronically. When the employee receives the SSN,
4. Wages and Other
file Copy A of Form W-2c, Corrected Wage and Tax State-
ment, with SSA to show the employee’s SSN.
Compensation
Correctly record the employee’s name and SSN. Re-
cord the name and number of each employee as they
Generally, all wages are subject to social security and
appear on his or her social security card. If the name is not
Medicare tax (and FUTA tax for U.S. Virgin Islands em-
correct as shown on the card (for example, because of
ployers). However, wages subject to social security tax
marriage or divorce), the employee should request a cor-
and FUTA tax are limited by a wage base amount that you
rected card from the SSA. Continue to use the old name
pay to each employee for the year. The wage base for
until the employee shows you the replacement social se-
social security tax is $110,100 for 2012. After you pay
curity card with the corrected name.
$110,100 to an employee in 2012, including tips, do not
If the SSA issues the employee a replacement card
withhold social security tax on any amount that you later
after a name change, or a new card with a different social
pay to the employee for the year. The wage base for FUTA
security number after a change in alien work status, file a
tax is $7,000 for 2012. All wages are subject to Medicare
Form W-2c to correct the name/SSN reported on the most
tax. The wages may be in cash or in other forms, such as
recently filed Form W-2AS, W-2CM, W-2GU, or Form
an automobile for personal use. Wages include salaries,
W-2VI. It is not necessary to correct other years if the
vacation allowances, bonuses, commissions, and fringe
previous name and SSN were used for years before the
benefits. It does not matter how payments are measured or
most recent Form W-2.
paid.
See the table in
section 12
for exceptions to social
Verification of social security numbers. The SSA of-
security, Medicare, and FUTA taxes on wages. See sec-
fers employers and authorized reporting agents three
tions
5
and
6
for a discussion of how the rules apply to tips
methods for verifying employee SSNs. Some verification
and farmworkers.
methods require registration. For more information, call
Social security and Medicare taxes apply to most pay-
1-800-772-6270.
ments of sick pay, including payments by third parties such
•
Internet. Verify up to 10 names and numbers (per
as insurance companies. Special rules apply to the report-
screen) online using the Social Security Number
ing of third-party sick pay. For details, see
Verification System (SSNVS) and receive immediate
Publication 15-A.
results, or upload batch files of up to 250,000 names
Determine the value of noncash pay (such as goods,
and numbers and usually receive results the next
lodging, and meals) by its fair market value. However, see
business day. Visit
Fringe
Benefits, later in this section. Except for
ployer/ssnv.htm
for more information.
farmworkers and household employees, this kind of pay
•
Telephone. Verify up to ten names and numbers
may be subject to social security, Medicare, and FUTA
with Telephone Number Employer Verification
taxes.
(TNEV) by calling 1-800-772-6270 or
Back pay, including retroactive wage increases (but not
1-800-772-1213.
amounts paid as liquidated damages), is taxed as ordinary
•
wages in the year paid. For information on reporting back
Paper. Verify up to 300 names and numbers by
pay to the Social Security Administration, see
submitting a paper request. For information, see Ap-
Publication 957, Reporting Back Pay and Special Wage
pendix A in the Social Security Number Verification
Payments to the Social Security Administration.
Service (SSNVS) handbook at
gov/employer/ssnvshandbk/appendix.htm.
Travel and business expenses. Payments to your em-
Registering for SSNVS and TNEV. You must register
ployee for travel and other necessary expenses of your
online and receive authorization from your employer to use
business generally are included in taxable wages if
SSNVS or TNEV. To register, visit SSA’s website at
(a) your employee is not required to or does not substanti-
and click on the Business Services
ate timely those expenses to you with receipts or other
Online link. Follow the registration instructions to obtain a
documentation, or (b) you advance an amount to your
user Identification (ID) and password. You will need to
employee for business expenses and your employee is not
provide the following information about yourself and your
required to or does not return timely any amount that he or
company.
she does not substantiate.
Page 6
Publication 80 (2012)
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