The IRS has released a draft of the 2020 Form W-4, Employee’s Withholding Allowance Certificate. The draft Form W-4 has been substantially revised to comply with the income tax withholding requirements of the Tax Cuts and Jobs Act (TCJA). This is an “early release draft,” which the IRS has released for public comment. Comments must be received by July 1, 2019, to be considered timely.
To comply with the TCJA, the draft form no longer includes a line for allowances but includes lines that will be used to calculate the withholding amount. One of those is a new “Head of Household” filing status option. Employees in households with multiple jobs are instructed to use the IRS withholding calculator or Worksheet 1 on page 3 of the form. Employees in households with only two jobs may check a box indicating this status rather than working through additional calculations. Doing so on the W-4 for each job may result in more tax than necessary being withheld, but generally should not result in too little tax being withheld.
The IRS has published FAQs on the early release of the 2020 Form W-4. There are 20 questions and answers with six of the FAQs dedicated to employer issues. The IRS will also release draft employer instructions soon, which will be in a new publication: Publication 15-T, Federal Income Tax Withholding Methods.
The IRS anticipates making changes to this draft of the 2020 Form W-4 before it is released as final. A new draft of the form is expected to be released later this summer.
APA to Comment
APA’s Government Relations Task Force IRS Issues Subcommittee plans to submit comments on the draft 2020 Form W-4 and employer instructions. If you would like to be involved in the process, indicate your interest by completing the Contact Us form on the APA website.
Additional Information
The IRS anticipates releasing more information on the draft form and employer instructions, which will be added to their respective webpages. APA will provide in-depth coverage in the June issue of Payroll Currently (Issue 6, Vol. 27).
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