Your W2 form reports how much money your employer paid you and withheld from your paychecks for your annual tax responsibility. You will need an accurate copy of your IRS W2 form to complete your federal income tax return.
The W2 also shows if you received other types of compensation. For example, W2 box 12 is for dependent benefits, health insurance premium payments, and other types of deferred compensation.
The W2 tax form informs the IRS which taxes you are subject to pay and how much your employer set aside for federal, state, and local taxes. For instance, you may be exempt from paying federal taxes.