2020 Form W-4

Beginning January 1, 2020, all new hires and any current employee wanting to change their federal withholdings are required to use the updated 2020 Form W-4.  The IRS has an FAQ page on all the questions you and your employees may have, but we’ve highlighted some of the most asked questions below.​​​​​​​​​​​​​​

 

Can someone help my employee decide what they should choose for all of the new steps?

Beginning in January, the IRS will have an updated Tax Withholding Estimator that will help employees decide how they should appropriately fill out the form. 

Do I have to complete all five steps of the new W-4?

No. The form is divided into 5 steps. The only two steps required for all employees are Step 1, where you enter personal information like your name and filing status, and Step 5, where you sign the form. Complete Steps 2 - 4 only if they apply to you. Doing so will make your withholding more accurately match your liability.

What happens if an employee only fills out Step 1 and signs the form?

Your withholding will be computed based on your filing status's standard deduction and tax rates, with no other adjustments.

How do we treat new hires (or rehires) who do not furnish a new 2020 W-4?

New employees first paid after 2019 who fail to furnish a Form W-4 will be treated as a single filer with no other adjustments. This means that a single filer's standard deduction with no other entries will be taken into account in determining withholding. This treatment also generally applies to employees who previously worked for you who were rehired in 2020 and did not furnish a new Form W-4.