Your employer will send your W-2 in early 2017. This year you might see a new item — a 16-digit authentication code. This code is part of an effort from the IRS which is meant to protect you from identity theft and make fraud more difficult.
Extended use of W-2 verification codes will aid verifying the wage and tax withholding data on your W-2. If you’re filing your taxes on your own, taking a moment to add this code helps the IRS verify your information. It might help protect you from identity theft and prevent a delay in receiving your refund. If Ellsworth & Associates handles your taxes, we will take care of that for you. You have nothing to worry about.
These codes were included on two million forms in 2016. In 2017, they will be included on 50 million W-2s. That’s a 2,400% increase. If you don’t see a code on your W-2, everything is fine. Your tax return will still be accepted.
The IRS says results from 2016 indicate this new system has the potential to reduce tax fraud. IRS processing systems use this number to verify the real taxpayer. Filing fake W-2s is one way that identity thieves try to back up their fake tax returns.