Employers “May” Need to Request New W-4

General Information

When you hire an employee, you must have the employee complete a Form W-4 (PDF), Employee’s Withholding Allowance Certificate. Form W-4 tells you, as the employer, the marital status, the number of withholding allowances, and any additional amount to use when you deduct federal income tax from the employee’s pay. If an employee fails to give you a properly completed Form W-4, you must withhold federal income taxes from his or her wages as if he or she were “single and claiming no withholding allowances, (S-0)”.

Exemption from federal income tax withholding

If an employee qualifies, he or she can also use Form W-4 (PDF) to tell you not to deduct any federal income tax from his or her wages. Generally, an employee may claim exemption from federal income tax withholding because he or she had no income tax liability last year and expects none this year. See the Form W-4 instructions for more information. However, the wages are still subject to social security and Medicare taxes.

A Form W-4 claiming exemption from withholding is effective when it is filed with the employer and only for that calendar year. To continue to be exempt from withholding in the next calendar year, an employee must give you a new Form W-4 by February 15. If the employee doesn’t give you a new Form W-4 by February 15, begin withholding based on the last Form W-4 for the employee that didn’t claim an exemption from withholding or, if one wasn’t furnished, then withhold tax as if he or she is “single with zero, (S-0)” withholding allowances. If the employee provides a new Form W-4 claiming exemption from withholding on February 16 or later, you may apply it to future wages but don’t refund any taxes withheld while the exempt status wasn’t in place.

Effective date of Form W-4

A Form W-4 remains in effect until the employee gives you a new one. When you receive a new Form W-4 from an employee, don’t adjust withholding for pay periods before the effective date of the new form. If an employee gives you a Form W-4 that replaces an existing Form W-4, begin withholding no later than the start of the first payroll period ending on or after the 30th day from the date when you received the replacement Form W-4. For exceptions, see Exemption from federal income tax withholdingIRS review of requested Forms W-4 , and Invalid Forms W-4 , later in this section.

For more information please visit IRS.gov.

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