What Payroll & Employees need to know with Withholding and the new W4

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Presentation transcript:

What Payroll & Employees need to know with Withholding and the new W4 Alan Gregerson October 2019

Draft 2020 Form W-4 www.irs.gov/draftforms

Software systems for new W-4s Two software systems for old and new W-4 is not necessary Same set of withholding tables used for both forms Apply these tables separately to systems for new and old forms Additional guidance will be provided on the payroll calculations needed based on data fields on the new and old forms

Use of new W-4 New employees who fail to submit a Form W-4 after 2019 treated as single filer with no other adjustments Beginning in 2020, all new employees must used the redesigned form

No requirement to request new W-4s Employees hired before 2020 are not required to submit a new Form W-4 Withholding will continue based on a valid form previously submitted Do not treat employees as failing to furnish Forms W-4 if they don’t provide a new Form W-4

Adjustment for nonresident aliens Pub 15-T will provide instructions on the additional amounts to add to wages to determine withholding for nonresident aliens Nonresident alien employees should continue to follow special instruction in Notice 1392 when completing their Forms W-4

2020 Publication 15-T Draft of Publication 15-T, Federal Income Tax Withholding Methods, for use in 2020 issued June 7 Comments must be submitted by July 8, 2019 to be timely IRS will post a new draft this summer to show final computation of withholding Can’t provide updated withholding tables for 2020 until the final Pub 15-T is released in December

Why a Paycheck Checkup? Some law changes in the Tax Cuts and Jobs Act may affect your withholding Protect against having too little tax withheld and facing an unexpected tax bill or penalty at tax time next year Avoid too much withholding; you can receive more in your paychecks

IRS.gov/withholding

What do I need? Most recent pay stubs Most recent income tax return

Results .

Your recap

What If I Have Too Much Withheld? File a new Form W-4 to: Avoid having too much withheld Put more in your regular paycheck

Resources: www.irs.gov/withholding Publication 505, Tax Withholding and Estimated Tax Form W-4, Employee’s Withholding Allowance Certificate Form 1040-ES, Estimated Tax for Individuals

W-2 scam Poses as company executive, asks payroll employee for list of all employees W-2s Targets: businesses, public schools, universities, tribes Employer/victims should email dataloss@irs.gov and provide POC Victims/non-victims should forward any suspicious W-2 emails (including full headers) to Phishing@irs.gov and use subject line: W2 Scam

W-2 spoof

Contact Information Alan Gregerson 763-347-7352 Alan.J.Gregerson@irs.gov