• Section: US Payroll
  • Last updated: Jan. 8, 2020, 4:59 p.m.

2020 W-4 Form and AccountEdge Pro

The IRS has released a new W-4 for 2020 and titled the new form "Employee's Withholding Certificate" which includes significant changes to assist employees with calculating withholding. These changes to the form were ushered in by the Tax Cuts and Jobs Act which took effect last year.

The new form also includes a new Step 2 Checkbox for those employees with multiple jobs or have spouses that also work.

You'll need to be using AccountEdge Pro v2019 with release 23.0.13 or later which supports the new W-4 form. Please use Check for Updates to make sure you are on the latest release.

All new employees hired in 2020 must use this new W-4 form. Existing employees who wish to make withholding adjustments will also use this new form.

If Steps 2, 3, or 4 on the W-4 form apply to employees and they provide this information, their withholding will more accurately match their tax liability.

On an employee card in the Card File under Payroll Details and Taxes, there's a new option to select Use Form W-4 2020 and Later or 2019 and Earlier. This will determine which fields are displayed for entering amounts into the new boxes that match up with Steps 2, 3, and 4 on the W-4 form.

If an existing employee updates their withholding using the new W-4 form for 2020, you should choose this option from the drop down and then select "2c box checked" if applicable and enter in the dollar amounts for boxes 3, 4a, 4b, 4c if applicable to the employee. These match the fields on the new W-4 form.

The following video New W-4 Settings for Payroll Year 2020 for more information on these new options.

The following FAQs from the IRS are available here: FAQs on the 2020 Form W-4. Additionally, the IRS has provided the following video which may be helpful for employers and employees: Understanding the 2020 Form W – 4 and How to Use it to Calculate Withholding.