Reject Code FW2-001-02 occurs when a W-2 is marked as a statutory employee W-2, but there is no associated Schedule C in the tax return.
Why This Happens:
Wages reported on a statutory employee W-2 must be included as income on Schedule C (Profit or Loss from Business).
These wages are not reported on Form 1040, Line 1 like regular W-2 wages.
How to Fix This Rejection:
Verify the W-2 entry:
Check if the "Statutory Employee" box is correctly marked on the W-2.
Ensure that a Schedule C is included in the return:
In TaxSlayer, go to:
Income Menu → Business Income (Schedule C)
Create a Schedule C entry.
Enter the business information and income from the W-2.
Link the W-2 to the correct Schedule C:
Select the correct Schedule C when prompted.
Save and retransmit the return.
For step-by-step guidance:
Following these steps ensures compliance with IRS requirements and prevents further rejection of the return.