Form W-4 Compliance for 2021 and Beyond

The Employee Withholding Certificate, commonly known as the Form W-4, is an IRS form used by an employer to withhold the correct federal income tax from an employee’s pay.
 
The 2020 version of the W-4 differed significantly from the prior versions of the form. The major difference is the focus on the employee’s expected tax situation for the year and the withholding allowances or exemptions are no longer a factor after 2019. However, where employees have not submitted the new form to their employers, the older versions of the form remain in effect. Employers may have to deal with two different withholding computation procedures.
 
IRS Publication 15-T, Federal Income Tax Withholding Methods provides tax tables and worksheets to accommodate tax computations for both prior to 2020 W-4 Forms and 2020 and later W-4 Forms
 
In this practical webinar, you will learn about how employees should complete the 2021 W-4 Forms. You will also learn how to use the Publication 15-T tables and the IRS Income Tax Withholding Assistant for Employers to compute withholding using either the 2020 or 2021 Form W-4 information or the information from prior year W-4 Forms that are still in effect.

• Understand the employer’s legal obligation to withhold tax.
• Know which employees are required to use the 2021 W-4.
• Know how to calculate withholding using both the current W-4 version and prior year W-4 Form
• Know how to use the IRS Income Tax Withholding Assistant for Employers
• Know what must or must not be included on each line of Form W-4 and how to identify invalid Forms.
• Know how to deal with special problems and situations related to Form W-4 such as non-resident alien forms, lock-in letters, and invalid and questionable employee submissions.
• Be aware of the penalties for non-compliance.
• Know the record retention requirements.

• The legal requirement that the employer withholds income tax from employee compensation
• Information provided on the 2021-W-4 and how it is used
• 2021-W-4 line by line
• How to compute withholding for the 2021-W-4 and year W-4 Forms still in effect
• How to use the Income Tax Withholding Assistant for Employers to facilitate manual computations
• The new withholding tables – How and when to use them. Example computations
• The special instructions for non-resident aliens
• State withholding certificates
• When employees are required to revise W-4 Forms
• Requirements for electronic W-4 Forms
• Penalties for failing to withhold or deposit tax and reporting errors.
• Record retention requirements – how long must an employer keep the forms

The current Form W-4 does not use the withholding allowances, so the method for computing withholding has changed. Since existing employees who do not want to change their withholding amount may leave prior Forms W-4 – Withholding Allowance Certificate in effect indefinitely, payroll professionals will have to know how to use both withholding calculation methods.
A handout package containing several key documents will be provided

• Payroll Professional
• Public Accountants
• Tax Compliance Officers
• Enrolled Agents
• Employee Benefits Administrators
• Officers and Managers with Payroll or Tax Compliance Oversight
• Company / Business Owners
• Managers/ Supervisors
• Public Agency Managers
• Audit and Compliance Personnel

Patrick Haggerty is a tax practitioner, author, and educator. His work experience includes non-profit organization management, banking, manufacturing accounting, and tax practice. He began teaching accounting at the college level in 1988. He is licensed as an Enrolled Agent by the U. S. Treasury to represent taxpayers at all administrative levels of the IRS and is a Certified Management Accountant. He has written numerous articles and a monthly question and answer column for payroll publications. In addition, he regularly develops and presents webinars and presentations on a variety of topics including Payroll tax issues, FLSA compliance, information returns, and accounting.