Handling and avoiding SSN discrepancies
A discrepancy in an employee’s Social Security Number (SSN) usually arises when an employer reports an employee’s wages on the Form W-2. The Social Security Administration (SSA) uses earnings information to determine eligibility for and the amount of Social Security benefits to which a worker may be entitled. If the combination of name and SSN on a Form W-2 cannot be matched to an SSA record, the SSA is unable to attribute the earnings to a worker’s record.
What does the SSA do when they cannot identify to whom the earnings belong?
The SSA notifies every worker whose name and SSN could not be matched to SSA’s records. This letter is sent to the address on the worker’s Form W-2. If there is no address or an address is not found in the Postal Service database of valid addresses, this letter is sent to the employer.
The SSA will also send employer no-match letters. Currently, these are sent to any employer who reported more than 10 no-matches that represented more than 0.5% of the W-2s submitted by that employer.
Responding to a No-Match Letter
The Employer notice advises of the discrepancies and asks the employers to prepare Form W-2c (Corrected Wage and Tax Statement).
In addition, one step recommended by the Department of Homeland Security (DHS) is to ask the employee to contact Social Security if there is a discrepancy with an SSA record. To ensure that an employee’s record is correct, the SSA recommends following:
- If an employee’s Social Security card does not show the correct name or SSN, or if the employee has lost his or her Social Security card, it is prudent for the employee to contact the local Social Security Office.
- The employee should provide the employer with the correct information as shown on the Social Security card or the corrected card.
How can employers avoid reporting discrepancies?
There are a number of reasons why reported information may not match records including:
- Typographical errors
- Unreported name changes
- Inaccurate or incomplete employer records
- Misuse of a SSN
Employers who offer self-service systems give employees access to their personal HR, benefits, and payroll information via the Web. Ascentis employee self-service (ESS) allows the human resources manager the ability to securely display selected HRIS data to the employee for verification. If information is updated, the employee’s changes are submitted for approval. Even name changes can be processed through Ascentis ESS.