Due to the Tax Cuts and Jobs Act, the Internal Revenue Service (IRS) has released a revised federal Form W-4 for tax year 2020. You may familiarize yourself with the new form here. Please note that this form is significantly different than the current form. The IRS has provided the following guidance:
- Employees hired before2020 are not required to submit new forms; withholding will continue based upon your previously-submitted valid W-4.
- Employees hired before2020 who wish to adjust their withholding after January 1, 2020, must use the new form.
- Employees hired on or afterJanuary 1, 2020, will be required to use the new forms.
- Employees hired on or afterJanuary 1, 2020, who do not submit a valid W-4 form will be treated as a single filer with no adjustments.
Please note that University of Houston Payroll Services cannot provide individual guidance on completion of the new W-4 or any related tax implications. We recommend that you contact your tax consultant with any questions you may have.
Additional IRS Information and Resources for 2020 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.