You need to prepare your annual tax returns every year, and you need the information from your W-2 to prepare your tax returns. If you do not have your W-2, it is still possible for you to prepare tax returns by getting the information that to be on your W-2 from one of your paystubs. Your pay stub is the paycheck that employer gives it every time they pay you. The paystub will have details of your pay for each period, the year to date payroll, the taxes and deductions that have been taken out of your total earnings, and the amount that you will get from the paycheck. A final paystub shows the details of the gross and net income that you have made throughout the year. A W-2 form is a tax form which lists the total amount of taxes that have been deducted from your paycheck during that year. Here is a guideline on how to calculate W-2 wages from a paystub.
The first thing that you need to do is to find your gross income. Your gross income is all the money that you have made that year without the tax withholdings and deductions. For a majority of people, this amount is the number of hours that they work within a week multiplied by the hourly rate. Details concerning income from overtime hours, commissions, and bonuses will also be present.
You will then need to subtract nontaxable wages from your gross income. The nontaxable wages are those that you receive which do not have any federal, state, or income taxes. The nontaxable wages can include such things as partnership income, gifts, employer insurance, and disability wages among others.
Next, you will need to account for other deductions. Some of the things that might be included in such a category include employer benefits, life insurance, health insurance, retirement accounts, transportation programs, and others. The sum of these deductions will be subtracted from what you got in step two. The result will be a taxable income for that year.
Determining your annual Texas is the next thing that you will do. You will need to find out the amount of local, state, and income taxes which are withheld from your earnings. The next thing will be to multiply the numbers with the number of times that you get paid each year. You will end up with a number representing the total amount of taxes which will be withheld from your earnings at the end of the year.
The final step will involve subtracting the total taxes to be withheld from your income from the amount calculated in step three. The number that you’re left with will be your W-2 earnings or your net income for the year.