It is common for loan transactions for information be verified from personal income sources such as W-2 forms and tax returns. The W-2 form may also be asked to be provided in cases where an individual is applying for employment as part of a background check. Verifying information from a W-2 can be completed by contacting the employer supplying the W-2 form to check for accuracy.
Verify that the business name listed on the W-2 is for a legitimate business independently. The business name and address is listed on the form. Check local yellow pages and directories to see if there is a business listed by that name and the address listed. Write down the phone number to contact the business. Other sources may be checking with the local business bureau. Verifying the W-2 comes from a legitimate employer is an important step before verifying the dollar amounts listed on the form.
Call the business to verify the employment of the individual for the year listed on the W-2. Some businesses will complete the phone verifications but will limit the information provided. Commonly businesses will provide start date, verify they are currently working or the end date of employment and title of the last position held. Most companies will not provide income information over the phone. Large companies may not complete phone verifications at all, requesting an authorization to release information from the employee or will direct the inquiry to The Work Number website which verifies employment information.
Obtain an Authorization to Release Information form for the person whose information needs verified. This form can be general stating that it is acceptable to release information within these dates and include a list of information that can be released that must be signed and dated by the individual releasing the information. A sample of an Authorization to Release Information form is located in the resources section of this article.
Provide the employer with the authorization form and provide the employer with a list of information that should be provided. This information may include annual income for the last three years and how that income was received. For example, different pays may include base salary, bonuses and commission pay. Compare the information provided on the authorization to the W-2 to verify the information matches.
Use the Work Number website if the employer does not verify employment. The person whose W-2 must be verified will have to provide a company code to access The Work Number. The Work Number offers different levels of reports including basic employment verification to providing income information for specific years. The Work Number does have fees associated with obtaining the report and varies depending on the amount of information requested.
Do not take information directly from the person to verify income. This includes phone numbers of supervisors. The only information that should be received from the individual is the company code for The Work Number.
Be aware that the company name on the W-2 may not match the name of the employer the individual provides. Companies may be parts of larger organizations, which are listed as the employer on the W-2 form.
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