IRS has released new Form W-4 Employee's Withholding Certificate for 2020

The Internal Revenue Service has released a new version of its Form W-4 Employee's Withholding Certificate. The form indicates how much federal income tax should be withheld from your paycheck.

What's new with the revised Form W-4?

The 2020 Form W-4, Employee’s Withholding Certificate, is very different from previous versions. This is due to the federal tax law changes that took place in 2018. Some of the changes include a no withholding allowances option, reintroduces the Head of Household filing status, and offers optional higher withholding for two-earner families.The form's withholding tables have been designed to work with new and prior year forms.

Who should complete the new form?

All new hires in 2020 and any current employees wishing to adjust their withholding must use the 2020 form. If you are not a new hire and you do not wish to change your withholding amount, you do not have to complete the form. According to the IRS' website, you should complete a new Form W-4 when changes to your personal or financial situation would change the entries on the form. If you do not submit a new form, withholding will continue based on your previously submitted form.

Download the revised Form W-4 Employee's Withholding Certificate. Deliver completed forms to the Office of Human Resources in Martin Hall, room 170.

How do I know what adjustments to make to my current withholding?

Even though you may not be required to complete the new form, it is recommended that you perform a "paycheck checkup" to see if you need to make adjustments to your current withholding. To conduct the checkup, you can 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.

What do I need to know about completing the revised Form W-4?

Before completing the 2020 Form W-4, please read the instructions that are included with the form. You must complete Steps 1 and 5. Steps 2, 3, and 4 are optional, but completing them will help ensure that your federal income tax withholding will more accurately match your tax liability. Step 1 is for your personal information; Step 2 is for households with multiple jobs; Step 3 is used to claim tax credits for dependents; Step 4 is for other adjustments (additional income such as interest and dividends, itemized deductions that exceed the standard deduction, and extra tax you want withheld); and Step 5 is where you sign the form.

The IRS takes your privacy seriously and suggests that, if you are worried about reporting income from multiple jobs in Step 2 or other income in Step 4(a), you check the box in Step 2(c) or enter an additional withholding amount in Step 4(c). To determine the additional withholding amount, you can use the withholding estimator.

Read Frequently Asked Questions for Form W-4. Consult your tax advisor for additional information. The offices of Human Resources and Payroll Services' staff are not authorized to give tax advice.