Vigilant Blog

News, trends and analysis in employment law, HR, safety & workers' comp

Jun 28, 2010

Final paycheck after employee admits lying about SSN


Q: Our employee recently admitted that he falsified his Social Security Number (SSN) when filling out his I-9. He gave us a new SSN that he swore was real, but we chose to fire him anyway for falsifying company records. But now we’re unsure how to report his final paycheck: Should we use the old SSN that we know doesn’t belong to him, or the new SSN that we haven’t verified?

A: Neither. If you report the wages to the IRS using a SSN that you know to be incorrect, you could face penalties. At the same time, you don’t want to report wages to a potentially questionable SSN. The IRS doesn’t offer any specific guidance about your situation, but they do have guidance regarding new employees who don’t provide an SSN. In that case, employers are to complete a W-2 form by entering all zeros (0) in the box requesting the employee’s SSN.

Vigilant recommends reporting final wages in the same way. You’ll want to complete Form W-2C, “Corrected Wage and Tax Statement” and Form W-3C, “Transmittal of Corrected Wage and Tax Statements,” by putting zeros in the box provided for the employee’s SSN. This way, the IRS knows that you didn’t intentionally report the employee’s wages under the wrong SSN and that you’ve corrected the reporting error once it was discovered.

This website presents general information in nontechnical language. This information is not legal advice. Before applying this information to a specific management decision, consult legal counsel.