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What is the SSA/IRS Employer Earnings Reconciliation
Process?
The SSA/IRS Earnings Reconciliation Process compares employees' wage
data submitted to IRS against employees' wage data submitted to SSA.
This data is submitted to both agencies by employers, their representatives,
third parties and agents.
When more wages were reported to IRS than to SSA, then SSA is concerned
that employees' earnings are not credited correctly to the agency's records.
SSA examines some of these cases and makes an effort to resolve the difference without
contacting the employer.
When an effort to resolve the discrepancy
is unsuccessful or a resolution is not possible
without employer assistance, SSA sends a
notice and questionnaire to the employer,
requesting the earnings data
needed to resolve the case. If SSA does
not receive a response after 45 days, the
employer is sent a second notice. When no
response is received after the second notice,
IRS is responsible for contacting the employer
and may impose penalties, if necessary.
If you are contacted by IRS or SSA about an Earnings Reconciliation issue
go to: What Employers Need to Know
about the SSA/IRS Employer Earnings Reconciliation Process.
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How to Avoid Reconciliation Errors
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Each January or February review the prior
year's Forms 941, 943, 944, or Schedule H against your payroll records.
Compare the amounts to be reported to SSA on Form W-3 to the sum of
the amounts you reported to IRS on Forms 941, 943, 944, or Schedule
H for the tax year. The following amounts on the IRS and SSA report
should match:
|
| ITEM |
W-2
Block |
941
Line |
943
Line |
944
line |
Schedule H
Line |
| Social Security Wages |
3 |
5a |
2 |
4a |
1 |
| Social Security Tips |
7 |
5b |
- |
4b |
- |
| Medicare Wages/Tips |
5 |
5c |
4 |
4c |
3 |
| Federal Income Tax Withheld |
2 |
3 |
6 |
2 |
5 |
| Adv. Earned Income Credit Payments |
9 |
9 |
10 |
8 |
7 |
You can contact us at 1-800-772-6270 from 7AM to 7PM EST
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www.socialsecurity.gov
