Is the IRS having second thoughts on the 2019 W-4?

When the IRS released the first draft of the 2019 W-4 back in June, it gave the public 30 days to comment. That 30-day comment period ended in early July. The IRS then said it would release a second draft of the W-4 sometime in August. Well, here we are at the last week in August and what do we have? Nada.

No likes for draft No. 1

Overall, commenters on the first draft of the W-4 have been negative, including the directive that employers enter employees’ withholding allowances, instead of employees. And some comments have been scathing.

  • The National Association of Tax Professionals called out the IRS on its advice that employees consult the 11-page instruction booklet, saying that was way too onerous.
  • The National Association of Enrolled Agents pointed out that, in order for employees to accurately complete the 2019 W-4, they’d have to consult 12 different IRS publications and forms
  • The American Payroll Association also aimed its comments at the draft’s complexity.

In addition, countless commenters noted that having employees disclose financial and other information to their employers was a serious invasion of privacy.

We agree: A W-4 is a basic form and you shouldn’t need an accountant’s help and have to spend hours poring over IRS pubs to complete it. If employees are under- or overwithheld, that’s their business, not their employers’.

Payroll Handbook D

Get your 2¢ in

Perhaps heeding these criticisms, the IRS is extending the comment period for the draft W-4 and the draft 1040 (which we also had issues with) until Sept. 18.

This delay is significant—the IRS has previously said that you’ll be able to use the second draft to begin programming your payroll system for 2019.

The later the second draft is released, the less time you have to update your payroll system. And considering how much time you’ll need to make those programming changes, communicate with employees about the changes and work out the bugs, having less time isn’t optimal, to say the least.

Our guess is that the longer the IRS delays, the more likely it is that it will ditch its newfound obsession with accuracy and just release a form that looks an awful lot like the current W-4.

You can submit your comments electronically, through the website. Remember: Be nice. Your comments are open to the public. We’ve already read a bunch of them. To see what other people have written, click here.

Happy National Payroll Week!

Next week is National Payroll Week—the week during which everyone who draws a paycheck should honor the inestimable work Payroll does. This year has been especially grueling, thanks to the Tax Cuts and Jobs Act.

Why the early shout out? Well, all of us here at Payroll Today will be in Las Vegas next week, for Business Management Daily’s HR Summit, so we’ll miss the celebrations.

Needless to say, we thank you for the spot-on job you do every week.