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IRS Releases Second Drafts of Redesigned 2020 Form W-4 and Withholding Instructions

The Internal Revenue Service (IRS) has released second drafts of the completely redesigned and renamed 2020 Form W-4 and new Publication 15-T, Federal Income Tax Withholding Methods for use in 2020. The changes are being made to comply with the 2017 federal tax reform law, which suspended personal exemptions through 2025. Although the final form and publication will not be released until the fall, the IRS has instructed employers to begin reprogramming their payroll software based on the second drafts.

IRS Issues Draft of Proposed 2020 Form W-4

The IRS has published a draft of the 2020 Form W-4, Employee's Withholding Allowance Certificate, which incorporates the changes made by the 2017 Tax Cuts and Jobs Act. The purpose of the proposed new design is to reduce the form's complexity and increase withholding accuracy and transparency, according to the agency.

IRS Releases Proposed Form W-4 Redesign

On Friday, May 31, 2019, the IRS released a new proposed design of the IRS Form W-4 to be used starting in 2020. The goal is to make it easier for employees to calculate accurate withholdings under the 2017 Tax Cuts and Jobs Act. Employees who already have completed a Form W-4 will not be required to submit a new Form W-4 simply due to the redesign. However, once finalized, the new Form will be required for employees hired on or after January 1, 2020. More information is available here.

2019 Social Security Taxable Wage Base Marks Notable 3.5% Increase

The Social Security taxable wage base - the ceiling on the 6.2% Social Security portion of FICA taxes - will be $132,900 in 2019. This represents a 3.5% increase over the 2018 taxable wage base of $128,400, and is one of the larger percentage increases in several years.


The Tax Cuts and Jobs Act signed into law on December 22, 2017 is prompting some prudent early tax 2018 actions by both employers and employees related to employee benefits. Many employers are electing to make additional employer qualified plan contributions for the 2017 tax year when the employer’s tax rate may be higher and thereby yield a bigger tax benefit. C corporations, in particular, whose federal income tax rate in 2017 was as high as 35%, may find worthwhile to make further 2017 plan contributions, such as discretionary profit sharing contributions, if permitted under their 401(k) plans (up to the general defined contribution plan limit of 25% of compensation), rather than make the same contributions for 2018 when the company’s tax rate is a flat 21%.

IRS Renews Warning of Form W-2 Scams Targeting HR and Payroll

The IRS is again warning about an email scam that seeks to trick HR and payroll professionals into providing employees' Forms W-2 containing their personal identifying information, including names, Social Security Numbers and income information. The email falsely uses the name of an actual corporate officer within the target's own organization to request the information.

It’s Tax Time – Alert Your HR and Payroll Teams About W2 Phishing Scams

Last February, the IRS issued a warning to all employers regarding the resurgence of a W-2 based cyber scam. The scam, which targets businesses during tax season, was also “spreading to other sectors, including school districts, tribal organizations and nonprofits.”

A Win for Boston Bruins: Tax Court Sides With Team in Clash Over De Minimis Fringe Benefits

In a recent, decision, the United States Tax Court determined that the pregame meals provided to Boston Bruins players and personnel at away games qualify as a de minimis fringe benefit under Section 274(n)(2)(B) of the Internal Revenue Code. Therefore, the cost of these meals is not subject to the 50-percent deduction limitation of Section 274(n)(l).

Everything Old Is New Again: Sharing Economy Companies Start Hiring W-2 Employees Instead Of Contractors

Gig companies – at least some – are discovering the upside to hiring W-2 employees.

It's W-2 Phishing Season: How to Stop, and Respond to, Tax-Related Identity Fraud Aimed at Your Organization's Employees

HR and payroll professionals nationwide have been, and will continue to be, targeted with e-mails apparently sent by a senior executive but actually sent by scammers who ask for a prompt reply with the 2016 W-2s for all of the organization’s employees. While reliable statistics are not yet available for the current tax season, the IRS revealed in 2016 that it had received more than 1,000 reports of tax-related phishing scams in January 2016 alone and that, in just the first half of last year’s tax season, it had already experienced a 400% year-over-year increase in these scams. In February 2017, the IRS issued an “urgent alert to all employers,” warning that the W-2 phishing scams have “evolved beyond the corporate world and [are] spreading to other sectors, including school districts, tribal organizations and nonprofits.”

Form W-2 Scams Targeting HR and Payroll Resurface, IRS Warns

The IRS has issued a warning to HR and payroll professionals about an email scam that falsely uses the name of an actual corporate officer within their own organization to request employees' Forms W-2 containing their personal identifying information, including names, Social Security numbers (SSNs) and income information.

IRS Provides Guidance on Safe Harbor for De Minimis Errors Made on Forms W-2, 1099

The IRS has issued Notice 2017-09, which provides for a safe harbor for filers that have made de minimis errors on certain IRS forms.

Payroll’s Guide to 2016 Form W-2 Year-End Processing

Even though tax year 2016 did not see major legislative changes related to payroll processing, the significant effects of the Protecting Americans from Tax Hikes (PATH) Act of 2015 is undoubtedly on the minds of all payroll professionals.

Form W-2 Cybercriminals Target HR and Payroll

HR and payroll professionals are falling prey to a current phishing scheme that lures them to respond to emails purportedly sent by company executives requesting private employee information, the IRS warned today. The scam tricks those in HR and payroll into emailing private employee data, such as Forms W-2 containing employees' Social Security Numbers (SSNs) and other personally identifiable information, to cybercriminals.

Accelerated Form W-2 Filing Deadlines Top-of-Mind For 2016

At this time of year, HR and payroll professionals are currently busy filing their usual year-end employment tax returns and making system changes for 2016. But on top of that, employers in some states will have to deal with the additional burden of having to file Forms W-2, Wage and Tax Statement, even earlier. This emerging trend is part of an overall state and federal government effort to prevent tax refund fraud.

IRS Launches Early Interaction Initiative

The IRS has launched an Early Interaction Initiative, aimed at helping employers understand and meet their payroll tax responsibilities. The initiative, which is geared toward small businesses and the self-employed, may help reduce employment tax delinquencies, along with interest and penalties, which may accrue as a result of an employer missing required payments.

New IRS Rules Eliminate Automatic Form W-2 Filing Extension

The IRS has issued a set of final, temporary and proposed regulations that remove the automatic extension of time to file information returns on the W-2, Wage and Tax Statement, series of forms (except Form W-2G, Certain Gambling Winnings). The temporary regulation allows only a single 30-day nonautomatic extension of time to file Forms W-2. The IRS says it is implementing these changes to accelerate the filing of W-2 series forms so they are available earlier in the filing season for use in the IRS's identity theft and refund fraud detection processes. Comments are requested on the proposed rules.

Credit Monitoring Services Following Data Breach NOT Taxable Income to Employees, IRS Announces

When an employer is responding to a breach of their employees’ personal information, one of the last things they may think about is whether the value of the credit monitoring or other identity protection services they make available to affected employees should be considered taxable to the employees and reported as such. In Announcement 2015-22, the Internal Revenue Service clarified that it will not consider the value of such services provided by the employer to employees to be gross income or wages to the employees. The IRS also stated it will not take the position that the employees should include the value of such services as gross income on their personal income tax returns.

IRS Issues Interim Guidance on Abatement of Failure to Deposit Penalty For 'Unbanked' Business Taxpayers

The IRS has issued a memorandum (#SBSE-04-0615-0045) providing interim guidance on abatement of the failure to deposit penalty under Internal Revenue Code (IRC) § 6656. The guidance applies to businesses that are unable to get a bank account (the unbanked) or make other arrangements for making federal tax deposits of corporate income, employment (Social Security and Medicare) and excise taxes using the Electronic Federal Tax Payment System (EFTPS), as required by IRC rules.

Untangling Healthcare Reform Form W-2 Reporting Requirements for PEOs

Executive Summary: With the re-election of President Obama and the Supreme Court's recent decision upholding portions of the Affordable Care Act (the "ACA"), health care reform is here to stay for the foreseeable future. Though limited challenges to the law are still pending, employers must prepare to comply with the many ACA requirements of 2013 and beyond.
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