IRS Provides 2020 Form W-4 Update

During the May 2 IRS payroll industry telephone conference call, Scott Mezistrano, IRS Industry Stakeholder Engagement and Strategy, provided an update for the 2020 version of Form W-4 (Employee’s Withholding Statement).

As a result of the enactment of the Tax Cuts and Jobs Act (TCJA) in late-December 2017, significant changes to the Form W-4 must take place. The IRS postponed a revised Form W-4 to reflect the important changes for 2018 due to time constraints, and also delayed the revision for 2019 due to concerns from the payroll industry about the initial 2019 draft version of Form W-4.

The 2020 Form W-4 will include the necessary changes. Mezistrano explains that a first draft version of the form is expected to be posted on the IRS website by May 31, 2019. The IRS encourages feedback on the first draft. A second draft version of the 2020 Form W-4 will be issued during the summer of 2019. Mezistrano said that the IRS encourages employers to begin programming the second draft version of the 2020 Form W-4 when it is released.

The final version of the 2020 Form W-4 is expected to be released sometime in the fall of 2019. “It typically takes until then because it depends on annual inflation adjustments to many dollar amounts that are used on the form,” Mezistrano said.

In response to a question regarding whether employees will be required to complete a 2020 Form W-4, Mezistrano said that there is no legislative authority for the IRS to require employers to obtain a new Form W-4 from employees once the 2020 version is released. He added that the “methods of calculating withholding, which we will publish soon, should be backwards compatible.” Meaning, that an employer should be able to use the new withholding methods whether or not there is a new Form W-4 on file for all employees.