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New IRS payroll guidance won’t require new W-4 forms

December 27th, 2017

By Aaron Lorenzo

Taxpayers shouldn’t have to submit new forms on how income taxes are withheld from their paychecks as a result of the new tax law, the IRS said.

New withholding guidance for 2018 that the IRS expects to issue in January should work with existing W-4 tax forms that have already been filed, the agency said.

Payroll withholdings are changing under the new tax law signed by President Donald Trump Dec. 22, and some employers are concerned about how fast they are being implemented.

“The IRS emphasizes this [withholding] information will be designed to work with the existing Forms W-4 that employees have already filed, and no further action by taxpayers is needed at this time,” said the announcement, which was posted on the agency’s website.

The effort is meant to minimize disruptions to millions of Americans’ paychecks in the New Year, as many of the new law’s changes are beginning less than two weeks after Trump gave it his signature.

The IRS is encouraging employers and payroll service providers to implement the changes in February, and taxpayers should start seeing changes in their paychecks as early as that month.

In the meantime, employers and payroll service providers should continue using the existing 2017 tables that explain how much should be withheld from different income levels and withholding systems.

Going forward, the withholding tables will be different and there is no longer an option to choose personal exemptions, which were eliminated in the new law.

Read the full article.