In the third session of Greenshades’ Year-End Power Series, the team tackled one of the most critical components of the filing season—W-2s.
Kieran O’Connor (Director of Managed Services) joined Mandy Haberkamp (Director of Demand Generation) to walk payroll professionals through the details that can make or break year-end reporting. From form variations and fringe benefit rules to new OBBBA guidance, this session offered the clarity and strategies needed to file with confidence.
📺 Missed the session? Watch the full recording here:
⚠️ Note: This information is for informational purposes only and does not constitute formal tax, legal, or compliance advice. Always consult with qualified tax advisors, legal counsel, and your organization’s internal teams for guidance specific to your situation. Additional regulations may apply. For the most accurate and up-to-date information, refer to official government resources and regulatory agencies.
Table of Contents
W-2 Basics: Reminders, Deadlines & Validation
The best way to ensure a smooth January is to get started early on data cleanup and validation.
- Reconcile early: Match your Q4 payroll reports to Forms 941 before finalizing year-end totals.
- Validate SSNs: Use the SSA’s Social Security Number Verification Service (SSNVS) to confirm employee name/number accuracy.
- Check the OMB number: For tax year 2025, the W-2 OMB number has changed to 1545-0029—make sure it’s updated on your forms.
- Don’t forget deadlines:
- W-2s are due to employees and SSA by February 2, 2026.
- W-2G forms are due to recipients by the same date but not due to the IRS until March 31, 2026.
Fringe Benefits: Taxability, Valuation & Common Errors
The IRS rule is simple: If it benefits the employee personally, it’s taxable—unless excluded by law.
- Taxable examples: Gift cards, personal use of company vehicles, and relocation reimbursements.
- Non-taxable examples: Employer-paid healthcare (Section 125), HSA contributions, some education benefits.
- Valuation tip: Use fair market value or IRS methods (such as annual lease value).
- Top errors to avoid:
- Forgetting to include fringe benefit values in Boxes 1, 3, and 5.
- Using placeholder SSNs (000-00-0000, 999-99-9999).
- For full IRS guidance, refer to Publication 15-B.
Sick Leave and Third-Party Pay: What to Track
Regularly audit your payroll earning codes to ensure sick leave types are correctly categorized.
- Different leave types must be tracked separately:
- Standard employer-paid sick time
- Disability insurance paid by third parties
- State-mandated PFML (Paid Family & Medical Leave)
- State-level complexity: Some states require sick leave data on W-2s.
- Third-party sick pay: Confirm with your insurance provider who’s responsible for filing W-2s.
W-2 Corrections & Extensions
Mistakes happen—but how you correct them matters.
- Use Form W-2C if you discover errors after filing with the SSA.
- If not yet filed: Correct the original form and re-issue to the employee.
- Timing tip: Wait 1–2 weeks after giving employees their forms before submitting to the SSA.
- Extensions:
- Use Form 15397 to request more time for employee delivery.
- Use Form 8809 for SSA submission extensions.
- Extensions are granted only for extraordinary circumstances.
OBBBA Provisions: What’s Changing (and What’s Not)
The One Big Beautiful Bill Act (OBBBA) is in its transitional year—and employers have flexibility in 2025.
- No new W-2 boxes or codes will be added for this tax year.
- No penalties for omitting qualified overtime or tips.
- Best practice: Include this info voluntarily in Box 14.
- For Overtime: Only the FLSA premium portion (0.5× regular rate) is exempt.
- For Tips: Only roles explicitly listed in IRS guidance qualify.
- Employees can calculate eligible amounts using:
- Box 7 (Tips) or Box 14
- Year-end pay stubs
- POS reports or Form 4070
How Greenshades Supports Year-End Filing
Greenshades Year-End Forms platform was built to simplify the heavy lifting.
✅ Payroll Clients
- After year-end processing, Greenshades will calculate an estimate of the FLSA OT premium for each employee.
- This data is added to Box 14 but can be downloaded and edited.
✅ Non-Payroll / YEF-Only Clients
- Upload calculated information during processing.
- Choose how to present it—Box 14 is recommended.
Platform Benefits
- Save Time: Import data from Greenshades, your ERP, or Excel.
- Streamline Processing: Manage all year-end forms in one secure system.
- Distribute Easily: File electronically, download e-files, or use print-and-mail services.
📌 Bookmark the Year-End Forms Hub for updated deadlines, tools, and resources.
Q&A Highlights
Here are a few rapid-fire questions that came up during the session:
- What should I label Box 14 entries for OT or Tips?
Use terms like Qualified OT 2025 or Cash Tips 2025.
- How early can we run SSN validation in Greenshades?
As soon as your W-2s are loaded.
- Do I need to report the full OT or just the premium?
Just the FLSA-qualified premium portion (0.5×) for qualified OT.