IRS Releases 2020 Form W-4

Updated: Dec 23, 2019


What changed?

The 2020 Form W-4, Employee's Withholding Certificate, is substantially different from previous versions of the form. The IRS revised the form to comply with the income tax withholding requirements in the Tax Cuts and Jobs Act (Pub. L. 115-97).


The form no longer uses the concept of withholding allowances to account for additional income, deductions, and tax credits, but includes lines where employees can enter those amounts directly so they can be used to calculate the withholding amount.


View old vs new W-4 form comparison, provided by American Payroll Association.


Who Needs To Use The New Form?

  • The new form is required to be used for all new hires in 2020

  • Employers are not permitted to require existing employees to complete a new form, however they may ask them to do so

  • Existing employees are required to complete a new form if they want to make changes to their withholding in 2020


IRS Tax Withholding Estimator

IRS recommends that employees perform a “paycheck checkup” to see if they need to make adjustments to their current withholding. To conduct the checkup, use the IRS’s Tax Withholding Estimator.

To effectively use the estimator, it is helpful to have a copy of your most recent pay stub and tax return. (It is likely that the estimator will be updated to account for the 2020 tax tables in early January.)

Note regarding State withholding taxes

Employees should not rely on the Federal 2020 W-4 submitted to their employer for the purpose of State withholding tax computation. For example the New York Form IT-2104 will still be using withholding 'allowances' which has been removed from the Federal 2020 W-4. If you submit only a Federal W-4 to your employer and do not file Form IT-2104, your employer may use zero as your number of allowances for your state withholding computation. This may result in the wrong amount of tax withheld for New York State, and Local taxes.

FAQs

For more information about the 2020 W-4 visit the IRS FAQ page.

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