Employers Can Truncate Employee Social Security Numbers on Forms W-2

In an effort to reduce identity theft, the IRS has issued final regulations that permit employers to truncate the social security numbers of employees on Forms W-2. Thus, the employer can elect to report the number in the format of XXX-XX-1234 or ***-**-1234 instead of providing the whole number. It is not a mandatory provision – the employer can choose to do it if it wants.

Full taxpayer identification numbers are still required on the copies of the Forms W-2 that are filed with the Social Security Administration, and on those of payers of third-party sick pay to employers.

The regulations are effective for items filed or furnished after December 31, 2020.

TD 9861