The IRS has developed a new Form W-4 that will go into effect on 1/1/2020.
The redesigned W-4 abandons the concept of filing status-based withholding allowances we are accustomed to using, e.g., married and 3, single and 2, etc. On the new W-4, employees will answer pointed questions aimed at identifying key amounts of income and deductions, resulting in a more precise income tax calculation. A new W-4 will be required for all 2020 new hires. Existing employees are not required to submit a new W-4 unless they update their personal information. Please refer to the FAQs and guidelines on the IRS site: https://www.irs.gov/newsroom/faqs-on-the-draft-2020-form-w-4.
Since the new form will no longer conform to state W-4 requirements, EP will begin requesting both the federal W-4 and state W-4s. A link to state forms will be distributed by EP in December.
EP Payroll Start Form
The new W-4 will be a separate document from EP’s payroll start form. EP has taken this opportunity to redesign its start form to include needed fields for Cal-Savers (https://www.treasurer.ca.gov/scib), such as resident vs mailing address, and birth date. We have also added fields to accommodate various requests we have received from clients:
- Legal Name: For tax reporting purposes, we must obtain an individual’s legal name, as shown on their SSN card.
- Preferred Name: Many individuals have a “preferred” name which they would like to see on reports (crew lists, etc.). To accommodate this scenario, we have added an optional “Preferred” name field to the Start Card. (Example: “Thomas James Smith” vs “TJ Smith”)
- Hired in State/County/City: To determine the correct union contract and conditions under which an employee is to be paid, we have added a “Hired in State/County/City” field.
- Work State/County/City: To determine the correct union contract, conditions, payroll taxes and sick leave we have added a “Work State/County/City” field.
The new Start Forms may be picked up from your local EP office or ordered directly from your paymaster. Due to the late federal notification of the final W-4 form, these forms will be packaged separately.
Please note that, due to the volume in certain states, EP will print and package state W-4 forms for: CA, NY, GA, LA, and NM. Other state W-4 forms will be available for download in December when EP provides the link to state W-4s.
Any incomplete federal or state W-4 forms will default to maximum withholding.
Please contact our Tax Support team at TaxSupport@ep.com with any additional questions.