MRB ACCOUNTING 516.427.7313
  • Home
  • Filing your taxes
    • Where's My Refund?
  • About
  • Contact
  • Why We Are Different
  • Links
  • Rates
  • Live Chat
  • Tax Update Blog
    • COVID Impact Page
  • Tax Reform
  • Industries
    • Automotive
    • Construction
    • Food & Beverage
    • Manufacturing, Retail & Distribution
    • Media & Entertainment
    • Nonprofit & Social Sector
    • Real Estate
    • Retail & Consumer Products
  • vCFO Services
  • Client Feedback
  • Newsletter
  • Media Room
  • The Influencer's Accountant

Tax Blog.

IRS issues interim guidance on 2019 payroll and income tax withholding matters

12/10/2018

1 Comment

 
From Baker Tilly; The IRS recently issued Notice 2018-92, providing interim guidance on various requirements and procedures for 2019 federal income tax withholding. This alert focuses on the following items addressed by the Notice:

2019 Form W-4 will be similar to the 2018 form.
In June 2018, the IRS released a draft of the 2019 Form W-4 and accompanying instructions, which included significant changes from the 2018 Form. In response to the resulting feedback, the IRS announced the redesign would be delayed until 2020. The Notice indicates the IRS will re-release the 2019 Form with minimal changes by the end of 2018.
Employee requirements for submitting Form W-4If an employee experiences a “change in status” that reduces the number of withholding allowances they are entitled to claim (for additional details regarding these allowances, please see our earlier alert), they generally must submit an updated Form W-4 to their employer within 10 days of the change. In January 2018, the IRS announced that employees whose allowances were affected solely by changes wrought by the Tax Cuts and Jobs Act (TCJA or the Act) were not required to submit updated Forms in 2018. The Notice extends this grace period through April 30, 2019. Accordingly, any such employee should submit an updated Form by May 10, 2019.

Under prior law, employees who failed to furnish a Form to their employer were treated as single with zero exemptions for determining their withholding requirements. Ultimately, the IRS and Treasury Department intend to withdraw and modify existing regulations, and issue guidance to allow employees to be treated as single, but entitled to certain additional allowances. However, in the interim, employees who fail to furnish a Form will continue to be treated as single with zero allowances.

Section 199A deduction 
For taxpayers that may be entitled to a deduction under section 199A (qualified business income deduction), the Notice allows such taxpayers to use an estimate of their anticipated 20 percent deduction to determine their withholding allowances to report on the Form W-4. As a reminder, wages are not qualifying income for purposes of the section 199A deduction.

Alternative withholding methods
As an alternative to using the personal allowances worksheet included with the Form to arrive at the number of allowances to claim, the Notice allows taxpayers to use the withholding calculator released by the IRS in early 2018. The Notice cautions this approach should not be used by taxpayers in certain tax situations, including but not limited to being liable for alternative minimum or self-employment taxes, or having long-term capital gains, qualified dividends or taxable Social Security benefits. We strongly advise that, if used, the calculator results be independently verified, particularly with the assistance of the employee’s tax advisor.

The IRS and Treasury intend to discontinue the combined income tax and employee FICA tax withholding tables for use in completing the Form due to the “unintended complexity and burden of the method.”

Withholding from pension, annuity and other certain deferred income:
Generally, payors of certain pensions, annuities and other certain items of deferred income are required to withhold from such payments pursuant to the number of allowances the recipient claims on their Form W-4P, Withholding Certificate for Pension or Annuity Payments. The Notice provides that similar to previous years, a recipient who has not submitted Form W-4P will continue to be treated as married and entitled to three withholding allowances, as applied to the 2019 withholding tables.
1 Comment
uk.bestessays reviews link
7/19/2019 03:48:17 am

Being an adult means that you have to deal with all of this. When I first started working, I got really scared of all the numbers that was presented in front of me. I was still a young kid when I entered his work force, and even today, I still have some immaturity in me. All of us will eventually have to deal with these numbers, and that is okay. It is not as tough as you think, you just need patience with it.

Reply



Leave a Reply.

    Author

    Archives

    March 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    June 2019
    May 2019
    April 2019
    February 2019
    January 2019
    December 2018
    October 2018
    September 2018
    March 2018
    February 2018
    January 2018
    November 2017

    Categories

    All

    RSS Feed

    The NY Accounting, Tax and Advisory Expert Blog

Proudly powered by Weebly
  • Home
  • Filing your taxes
    • Where's My Refund?
  • About
  • Contact
  • Why We Are Different
  • Links
  • Rates
  • Live Chat
  • Tax Update Blog
    • COVID Impact Page
  • Tax Reform
  • Industries
    • Automotive
    • Construction
    • Food & Beverage
    • Manufacturing, Retail & Distribution
    • Media & Entertainment
    • Nonprofit & Social Sector
    • Real Estate
    • Retail & Consumer Products
  • vCFO Services
  • Client Feedback
  • Newsletter
  • Media Room
  • The Influencer's Accountant