Is it legal for my employer to put my first payroll of 2014 on my 2013 taxes? We were paid on 1/3/14 for 12/16/13-12/28/13. The way I have understood this, it that is not based on when you earned it, only when it was paid to you. Is this correct? If so, how would I go about getting this corrected with the "accountant" we have is insistent she has done nothing wrong.
1 Answer from Attorneys
IRS Instructions for W-2 Provide: "The entries on Form W-2 must be based on wages paid during the calendar year. Use Form W-2 for the correct tax year. For example, if the employee worked from December 22, 2014, through January 9, 2015, and the wages for that period were paid on January 10, 2015, include those wages on the 2015 Form W-2." If your employer is on the accrual basis of accounting, the employer can deduct wages paid in 2014 but earned in 2013 on the employer's 2013 income tax return, but that doesn't mean the W-2 should include those 2014 amounts.
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