Form W-4 Employee’s Withholding Allowance Certificate is updated for 2020 and beyond till further notice from the IRS. The form itself hasn’t changed much but if you’ve completed a W-4 in the past, you may find the new form a little bit confusing. The only thing that has changed is the structure of the form but its purpose remains the same.
On Step 1 of the form, you’ll need to detail your Full Name, Address and filing status. In the previous form, you could select your filing status as married but would withhold at a higher rate has been removed. Instead, you only check your filing status and that’s it.
Step 2 is about your secondary or third jobs if there is any and your spouse’s work. This is only for those who hold more than one job or married filing jointly and if your spouse also works. The correct amount of taxes that will be withheld in the future depends upon income earned from these jobs.
There are also sections related to Child Tax Credit and dependents on Step 3 of W-4. On this part of the form, you need to multiply the number of qualifying children under 17 with $2,000 which is the Child Tax Credit amount for 2019 taxes. For dependents, you’ll need to multiply the number of dependents by $500.
This only applies to you if you can claim these credits and deductions.
If you don’t want your other income not to be subjected to withholdings, you can do so by entering the amount of other income. The other income refers to income that isn’t coming from jobs. It can be money you’re receiving from a property, interest, retirement income, etc.
Sign the Form and enter the date of the day you completed the W-4. If you’re an employer, enter your Employer Identification Number and First Date of Employment.