IRS W-4 procedures: New hire withholding in 2020 vs. 2019 Handling forms with missing info & more The wait is over: The IRS has released the final version of the New Form W-4 – and it’s also cleared up some confusion about tricky situations that may arise with the form. In a recent IRS Payroll Industry Call, the agency addressed how Payroll should hand deductions if a new hire doesn’t specify a withholding amount on Form W-4 or doesn’t submit a valid copy of the form. Options for tax deductions Depending on when the person was hired and started getting paid, Payroll must follow different procedures if a person hasn’t submitted a valid W-4. Generally, if people are hired and first start receiving wages in 2020, withholding should be treated as if they’d checked the box for single or married filing separately in Step 1(c) of the 2020 W-4 without completing any of the other steps on the form. However, if someone was hired on or before Dec. 31, 2019, and received his or her first paycheck in 2019, withholding should be handled as if the person were single and claimed zero allowances on the 2019 Form W-4. Not all hiring situations are this cut and dried, so the IRS also offered additional insight on other scenarios during the Payroll Industry Call. If an employee was originally hired at some point in 2019, quit that same year and the rehired in 2020, Payroll would follow the withholding procedures for the 2020 Form W-4. The same would be true if an employee was hired in 2019, quit in 2020 and was rehired later that year – or if a person was hired at the very end of 2019, but didn’t receive his or her first paycheck until 2020. For clarity’s sake, the agency also confirmed that, if a person is hired in 2020 and continues working throughout the year, that person is subject to withholding under the procedures for the 2020 W-4. Any new hires from 2019 who continue working in 2020 are still subject to withholding under the old 2019 Form W-4. Remember Payroll can encourage employees to submit an updated W-4 at any time. Letting them know they may take home more money each paycheck if they submit an accurate up-to-date form could help.