When you work with ShiftMed, you're a W-2 employee—generally considered the most traditional form of employment. But what does that mean exactly?
In short, we send you a W-2 Form to file your taxes. Other workers, such as 1099 contractors, are classified under different forms of employment based on the tax form they use to file their taxes.
ShiftMed will mail your W-2 to the address we have on file, so it's important to make sure what we have is current. You can also access your W-2 Form in Paylocity.
What is a W-2 Form?
Disclaimer: ShiftMed does not provide legal, accounting, or tax advice. This content is for informational purposes only and is not intended to provide legal, accounting, or tax advice. Please refer to a professional advisor prior to acting on the information set forth herein.
A W-2 is an IRS form that your employer provides to you in January. It summarizes your income from the previous year and shows how much you paid in payroll taxes during those 12 months. You need this wage and tax statement to prepare your annual tax return.
For example, the W-2 you received from your employer in January 2022 reflected your income and tax withholdings for 2021. If you work as a W-2 employee at more than one company during a year, you'll receive a separate W-2 Form from each employer.
Your employer also sends copies of your W-2 to the Social Security Administration, Internal Revenue Service (IRS), and your state and local tax authorities as a legal requirement.
W-2 Employee vs. 1099 Independent Contractor
App-based staffing agencies can classify healthcare professionals as W-2 employees or 1099 independent contractors. As noted earlier, when you work with ShiftMed, you're a W-2 employee—and it's the best worker classification you can have. Check out our blog post that gives five reasons why being a W-2 employee is better.
Accessing Your W-2 Form in Paylocity
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If you are unable to access these documents, please contact your HR team - even if you are not employed there anymore.
Income and Payroll Taxes
Every wage-earning worker must pay taxes to the IRS. As a W-2 employee, you pay income and payroll taxes every paycheck. (1099 independent contractors pay the same taxes but do so in one lump sum at tax time.)
Basic taxes workers must pay to the IRS:
· Federal Income Tax
· State Income Tax (if applicable)
· Social Security Payroll Tax
· Medicare Payroll Tax
You can learn more about these taxes in our blog post "3 Things You Must Know About Payroll Taxes."
Why Your Pay in the ShiftMed App May Look Different from Your Check
When viewing pay in the ShiftMed app, you have to be conscious that the pay in the app is your gross pay. Your gross pay is your salary before taxes are taken out and will not be the payment you will receive on your check. Remember to account for taxes when looking at your paycheck.
Tax Rates & The Amount You Pay
Several variables, such as employment classification, federal income tax bracket, marital status, and state of residence, determine the amount someone pays in taxes.
Federal Income Tax and W-4 Form
When you're a W-2 employee, your employer uses an IRS formula and your Form W-4 information to calculate the taxes you must pay to the IRS every paycheck. Your employer submits these taxes directly to the government on your behalf.
What is a W-4?
It is an IRS document that you complete, and we use this document to determine the amount of federal taxes we should withhold from your check.
When you complete a W-4 Form, you're telling your employer how much federal income tax to withhold from your paychecks. You can update your W-4 at any time within the ShiftMed app. The IRS recommends that you consider completing a new form whenever your personal or financial situation changes.
How to Update Your W-4 Form?
You must use the ShiftMed app to make changes to your W-4 Form. DO NOT use Paylocity to update your W-4, as these edits will not reflect in the app.
To Update your W-4 Form, enter the ShiftMed app and locate the "Banking & Taxes" section.
If you have never updated your W-4, the app will direct you to our W-2 Information.
We will send a verification code to your phone via text or call.
Enter the code within 20 minutes to proceed.
After verification, you have another 20 minutes to complete and submit your W-4 changes.
If you are unsure about your withholdings or deductions, we recommend:
Consulting a tax professional.
Downloading the official IRS W-4 Instructions for detailed guidance.
Claiming a Tax Exemption
Selecting BLOCKED means you are claiming exemption from federal tax withholding. This requires a manual process.
Download and Complete a W-4 form.
Sign the form manually
Email the signed form to shiftmedpayroll@shiftmed.com
Form processing takes 3-5 business days after we receive it.
Changes will then take effect within two pay cycles.
Tax exemptions expire annually. To maintain a "BLOCKED" status, you must submit a new, signed W-4 form each year.
State Income Tax
Not every worker in the United States has to pay state income tax as this depends on the state. As of 2025, Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming are the only states that do not levy a state income tax.
If an employee must pay state income tax, their employer withholds the required amount every paycheck and submits that amount to the appropriate state entity.
If your state requires you to pay state taxes, you are not necessarily required to complete the state tax form. However, the maximum withholding amount set forth by your state will be deducted from your paycheck. You can complete a state tax form at any point during the year. Once you've completed and signed your state tax form, please email it to us at shiftmedpayroll@shiftmed.com.
Due to adjustments and processing times, please allow 2-3 business weeks for your paycheck to reflect your state withholding information.
Federal Insurance Contribution Act (FICA) Taxes
Social Security and Medicare taxes fall under the FICA umbrella, with 15.3% of your wages going toward these federal programs every pay period. You pay half of these taxes (7.65%), and your employer pays the other half (7.65%). (If you were a 1099 independent contractor, you'd have to pay the complete 15.3% out of your pocket.)
Questions?
If you have any questions, reach out to us in chat by going into the ShiftMed App > Menu > Help Center > Chat & Help Articles> Ask a Question!