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Prior to creating the W-2/W-3 upload file, Forms W-2 must first be processed. Processing Forms W-2 generates Forms W-2 and the W-3 at the same time. To process Forms W-2, go to Employees > Federal Forms and select Forms W-2/W-3 as the Form Type.

See “Processing Forms W-2 and W-3” for more information.  

Creating the W-2/W-3 Upload File

Use Create File (e-Filings > W-2 > Create File) to generate the file containing W-2 and W-3 information that is transmitted to the Social Security Administration.

To create the transmission file, complete the following steps:

  1. Go to e-Filings > W-2 > Create File.
    Most of this window will fill depending on the information entered on the Client > Edit > e-File Options tab
  2. Complete the Employer Record Information section. 
    • Agent Indicator Code
      • Select the appropriate agent indicator code.
        An “agent” is someone other than the employer used to pay the employer’s taxes.
        • 2678 Agent (Approved by IRS)
          • Select this option if you use an IRS-approved section 2678 agent to file returns and make deposits or payments of employment or other withholding taxes.
          • Access the Form 2678 from www.IRS.gov.
          • When this option is selected, you must enter the Agent EIN.
        • Common Paymaster
          • A corporation that pays an employee for two or more related corporations at the same time is a common paymaster.
          • When this option is selected, you must enter the Agent EIN.
        • 3504 Agent
          • Select this option if using an employer-designated section 3504 agent.
          • For information on this agent type, go to www.IRS.gov.
          • When this option is selected, you must enter the Agent EIN.
        • Other
          • Select this option if none of the others apply.
          • Verify the Employer EIN is correct.
  3. If this is the last year that Forms W-2 are being filed under this EIN, select Terminating Business. 
  4. Enter the Employer EIN and/or Agent EIN, as applicable. 
  5. Under the Selected Forms W-2 section, select whether you are preparing to e-File an Employee W-2 or On the Fly W-2

    The State 1 and State 2 columns indicate the states entered in Box 15 of the W-2 for that employee.  

    If the State Employer ID Number box has not been completed on the W-2 or applicable e-Filing information has not been completed on the State tab of Client Setup, a blue validator icon will be listed next to the state missing this information. Not completing this information could result in a rejected e-File.

    Once the selection is made, applicable employees will be listed.  

    • Employee W-2 indicates that payroll has been entered either live or ATF (after-the-fact). 
      • The W-2 is accessible under Employees > Federal Forms.  
    • On the Fly W-2 indicates you are uploading W-2 information for clients that you've not entered their payroll into Drake Accounting, either live or ATF.

      • The W-2 has been created under On the Fly > Federal Forms.

  6. Select which employee(s) you want to e-File by either selecting the box to the left of the employee, or select the box next to the First Name column header to select all of the employees. 

    By default, the most recently saved forms will be checked. 
  7. Complete the General Information section:
    • User ID Number (BSO User ID Number)
      • Enter the 8-character user ID assigned to the employee who is attesting to the accuracy of the file.
      • This user ID is assigned by the Social Security Administration when the employee registers to use the SSA's Business Services Online.
      • To register, go to http://www.ssa.gov/bso/bsowelcome.htm.
    • File is being resubmitted
      • Select this check box if the W-2 file is being resubmitted after being notified by the Social Security Administration that there was a problem with a previous upload file.
      • When this field is selected, the Resubmit Wage File Identifier field becomes active.
      • Enter the wage file identifier displayed on the notice received from the SSA.
    • Iowa BEN
      • The Iowa BEN on the W-2 Create File screen is different than the Business E-File Number on the State tab in Client Setup.
        • The Iowa BEN on the Create File screen is a Firm-level number, so it is saved between all clients and is used as part of the e-File name.
        • The Business e-File Number on the State Tab is for that specific client and is used for Iowa's RV record.
          The Iowa BEN on the Create File screen is required, but it is recommended that the Business E-File Number in Client Setup also be completed. However, if one of the selected W-2s has Iowa in the State 1 or State 2 column, both the Iowa BEN and the Business E-File Number (Client Setup > State tab) need to be filled out.
  8. Select the Preparer Code that best describes the preparer of this client transmission file.
  9. Once you have verified all information is correct, click Create File. The upload file name and location is displayed.                                                                                            
    • Make note of the location where the transmission file is created.
    • This information is needed to transmit the file to the Social Security Administration.

      To easily access all of your e-Files created in Drake Accounting, refer to the "Manage e-Files" screen. On this screen, after expanding the applicable client and finding the W2REPORT_Client.txt file, simply click "Open Location" to open the exact location of the file for easy retrieval when uploading to the Social Security Administration. 

      If a message displays stating that no Forms W-2 have been processed for the year, go to Employees > Federal Forms to process the W-2s.
  10. Once the transmission file has been created, proceed to “Using AccuWage to Review the W-2 Upload File” to identify possible errors in the file.
  11. Once you have used AccuWage to review the file and are ready to transmit, go to e‑Filings > W-2 > Transmit File to upload the information to the Social Security Administration.

    The following states will also have a blue validator if the following fields are not filled out in the State tab of Client Setup for that state: 


    IA: Business E-File Number (8-digits) 
    ID and PA: State Employer Account Number 
    MO: State ID 
    IN: Employer Taxpayer ID and Employer TID Location 

    States that would not have a blue validator include AK, CA, FL, MD, NV, NH, SD, TN, TX, WA, WV, and WY because these states currently do not e-File the W-2. 

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