What is W2 Employee?

A W2 employee is an individual who is employed by a company and receives a W-2 tax form at the end of the year, detailing their earnings and the taxes withheld from their paychecks. This classification means that the employer takes responsibility for withholding income taxes, Social Security, and Medicare taxes, as well as providing benefits like health insurance and retirement contributions. W2 employees typically work under specific schedules and guidelines set by the employer, distinguishing them from independent contractors who have more flexibility and control over their work.