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W2 Question


ETax847
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A client's employer switched paycheck providers in September.  The old company (Paychex) gave him a W2 for just the income when they were with them.  The new company (ADP) gave him a W2 for the entire year, including the time with the old paycheck provider. 

Has any one dealt with this situation before and what should the client do to fix this issue?

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CYA.  The old provider only has figures until they were fired.  Whether or not they should even have issued a W2 is something I cannot answer.  Likely though, they were contracted to "handle" the payroll, including funds, so they are also in the liability chain for then they were engaged.  Thus, to C their A, they filed forms using the information they had.

The new provider was likely (and properly) given existing YTD figures, so the checks and reports they create would be accurate.  This is the "rub", as they prepared complete year forms, and not just forms from when they were engaged.

The employer needs to find out if both were submitted to the SSA, and go from there.  Hopefully the former company did not file.  If the former company, or both, filed, then the employer will need some "c" forms submitted.

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Be glad you found out before filing! We had a similar case some years ago (before the entire IRS system collapsed, fortunately) and did not find out until the CP2000 letter to the client demanding tax and underreporting penalties etc on basically his entire income a second time.  (Payroll provider switch was in November, if memory serves.)  The IRS accepted a letter from the employer stating this was an error and that the old payroll company was going to issue W-2C forms for $0.  For hundreds of employees... ouch.

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Just went through a very similar situation for 2019 with a client.  He got a CP2000.   W2c still not processed by the IRS.   We sent the letter with the backup, (W2, W2c) but fear this will drag on for a long time.   Who knows when the IRS in Fresno will read the letter.

Tom
Longview, TX

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