The Internal Revenue Service (IRS) has released an early draft of the 2019 Form W-4, Employee's Withholding Allowance Certificate, and corresponding instructions. However, the IRS has indicated that employers should not file draft forms, nor rely on draft forms, instructions and publications for filing, as it is anticipated that it is likely that the instructions will change significantly before released as final.
The IRS has released the early draft as a courtesy to provide guidance on determining income tax withholding for individual taxpayers after the passage of the Tax Cuts and Jobs Act of 2017 (TCJA). The TCJA made signiﬁcant changes to tax rates, deductions, tax credits, and withholding calculations, beginning in 2018 and the new form and instructions were drafted to reflect those changes. Specifically, the TCJS eliminated personal exemptions, increased the standard deduction, increased the child tax credit, limited or discontinued certain deductions, and changed the tax rates and brackets.
The 2018 Form W-4 and instructions were four pages, whereas the 2019 draft form is less than two pages as a result of the elimination of the “Personal Allowances Worksheet,” the “Deductions, Adjustments, and Additional Income Worksheet,” and the “Two-Earners/Multiple Jobs Worksheet” from the instructions. In addition, the 2019 form no longer has a line to report the number of allowances the taxpayer is claiming.
The IRS will be posting a new draft this summer. Until then, the draft 2019 Form W-4 should not be provided to employees, since it will likely change. We will continue to keep you updated as to the release of the new draft form and any modifications made to same.