From CareerJournal.com. Used with permission
By Perri Capell
Question: After a first interview for a new job, a potential employer asked me to provide W-2 forms. What if I don't want to share them?
Answer: You don't have to share your W-2s, but it's unlikely you'll go further in the hiring process if you don't. "The moment you don't share salary information with people, they become alarmed," says Mark Elzweig, president of the search firm Mark Elzweig & Co.
Used for income-tax purposes, annual W-2 forms list the wages you were paid and taxes that were withheld by an employer. Asking for a prospect's W-2 forms is common in the financial industry and in other fields, particularly for sales jobs and at larger companies.
In the financial-services industry, companies want to see two or three years of income on W-2s to verify gross sales or production, says Mr. Elzweig, whose firm specializes in financial services. Many of the employers in this industry guarantee a certain salary in the first year and need to know that paying the amount is justified, he says.
Sales professionals also often have to show W-2s when employers are guaranteeing a first-year salary, adds Matt Becker, CEO of search firm Becker Professional Services.
And for certain executives, employers request W-2s to determine their total compensation payouts, or the salary plus bonus they earned in recent years. If you are applying for a job with a different prospective salary and potential bonus than you previously earned, it's in your best interest to share the W-2 data, says Marie Rice, managing director of Jay Gaines & Co., which specializes in financial services. "If you had a consistently high year-over-year bonus, you want that reflected if you are moving into a formula with a high base salary and low bonus," she says.
It's possible you may not want to give out W-2 information because you believe you were underpaid in your past position and don't want your new salary to be based on your prior pay. In this case, you must persuade employers to pay you at the market rate for the job, says Mr. Elzweig. He recommends saying something like, "I am making X, and if I was to move, I would want to be paid based on what the job is worth." Naturally, you'll need to demonstrate that you have the skills and abilities to deliver what the company needs.