Can I generate a retroactive W2 for work that has been already done prior to starting an LLC?

[lsalazar1985]

Work was done in tax year 2023, worker is requesting a W2 as they do not want to submit a Schedule C. I have not yet started the LLC--should I do this before the tax year is out? Thank you for the feedback!

[Anonymous_]

This is not something you can do without a hassle, and you need to determine whether this "worker" was actually an employee or an independent contractor. If the latter, then a 1099-NEC is appropriate, not a W-2.

[Mike9241]

if the worker is an employee you should consult a tax pro.  

1) you probably didn't withhold the required payroll taxes - as a minimum Social Security and Medicare. You may also have been required to withhold Federal and state income taxes

2) unless the person was engaged in the last quarter of 2023, you have failed to file payroll tax returns (Federal 941 state? ) and pay the taxes that should have been withheld and your company's share of FICA and Medicare taxes

3) you would also likely need to file Federal form 940 Unemployment Compensation tax your state may have similar taxes and filing and payment requirements

4) most states require your company to register as a withholding agent and possibly for filing and payment of its UC taxes

Thus if the worker is an employee you face substantial penalties. He can report you to the IRS and it will contact you to determine if an employee or IC. 

you may want to complete IRS form SS-8 without sending it to the IRS. Used this to help determine employee vs independent contractor status. If audited/ the IRS could make a different determination.

https://www.irs.gov/forms-pubs/about-form-ss-8