ITG FAQ #3 Answer-Can an employer be penalized for a Form W-2 filed where the employee’s last name does not match the last name on file with SSA?
Can an employer be penalized for a Form W-2 filed where the employee’s last name does not match the last name on file with Social Security Administration? What should an employer do to avoid this penalty? Yes. An employer can be assessed civil penalties under IRC § 6721 for each mismatched Form W-2. In order to avoid any civil penalties an employer should: • Ask each new worker for proof of his/her Social Security number (SSN). • Accurately record in payroll records the SSN and name as provided by the employee. A duly executed Form W-4 should be on file for each employee. It is especially important to know the exact last name. • Remind employees to report any name changes due to marriage, divorce, etc., to the Social Security Administration (SSA) and to their payroll department. If a name has changed, continue to use the old name until the employee obtains an updated Social Security card with the new name. Employers may verify employee SSNs by using the SSA Employee Verification Servic
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