LINE 1 W-2 INCOME

    1 Missing or Incorrect Form W-2?

    Your employer is required to provide or send Form W-2 to you no later than February 2, 2026. If you do not receive it by early February, use Tax Topic 154 to find out what to do. Even if you do not get a Form W-2, you must still report your earnings. If you lose your Form W-2 or it is incorrect, ask your employer for a new one.

    2 Were You a Statutory Employee?

    If you were a statutory employee, the “Statutory employee” box in box 13 of your Form W-2 should be checked. Statutory employees report the amount shown in box 1 of Form W-2 on a Schedule C along with any related business expenses.

      2.1 Key Categories of Statutory Employees

      According to the IRS, a statutory employee is treated as an employee for Social Security and Medicare tax purposes, even if classified as an independent contractor under common law. To qualify, a worker must fall into one of the following four categories and meet specific conditions.

        Drivers

        • Drivers who distribute goods such as beverages (excluding milk), meat, vegetables, fruit, or bakery products.
        • Drivers who pick up and deliver laundry or dry cleaning.
        • These drivers are typically paid on commission and act as agents of the employer.

        Full-Time Life Insurance Sales Agents

        • Agents who sell life insurance or annuity contracts primarily for one life insurance company.
        • Their principal business activity must be selling insurance for that company.

        Home-Based Workers

        • Individuals who perform work at home using materials or goods supplied by the employer.
        • The completed work must be returned to the employer, and the employer provides specifications for how the work should be done.

        Full-Time Traveling or City Salespeople

        • Salespeople who solicit orders from wholesalers, retailers, contractors, or operators of hotels, restaurants, or similar establishments.
        • The goods sold must be merchandise for resale or supplies for use in the buyer’s business.
        • This must be the salesperson’s principal business activity.

      2.2 Conditions for Statutory Employee Status

      • Perform services substantially by themselves.
      • Not have made a substantial investment in the equipment or products used for the work.
      • Perform work on a continuing basis for the same employer

      2.3 Social Security and Medicare Tax Withholding for Statutory Employees

      Withhold Social Security and Medicare taxes from the wages of statutory employees if all three of the following conditions apply:
      • The service contract states or implies that substantially all the services are to be performed personally by them;
      • They do not have a substantial investment in the equipment and property used to perform the services (other than an investment in transportation facilities); and
      • The services are performed on a continuing basis for the same payer.

      2.4 Income Tax Withholding for Statutory Employees

      Do not withhold federal income tax from the wages of statutory employees.

      2.5 Federal unemployment (FUTA) tax and reporting payments to statutory employees

      Publication 15-A provides information on federal unemployment tax treatment and reporting payments to statutory employees.

      2.6 Statutory employees reporting income and expenses

      Refer to Instructions to Schedule C (Form 1040), Profit or Loss From Business, for guidance on how statutory employees report income and expenses.






Created 5/30/2025 by administrator.
Last reviewed or updated 12:55 PM 9/28/2026 by administrator.

Compiled and edited using resources found on, but not limited to, irs.gov and OLRC

    CONWAY MYKOL TAX
    email: info@conwaymykol.com
    email: marcia@conwaymykol.com
    telephone: 1+ (302)241-9804

© 2025 Conway Mykol LLC. A licensed Delaware business. This page utilizes the Duvanel Aspen System of Learning developed by Marcia Banks Mazur. All Rights Reserved.