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IRS W-4 2020 Released: What it Means for Employers

Posted on by try HRIS

Official W-4 2020 Form was released December 5, 2019.

December 8th 9:52Am

On December 5, 2019 the IRS released the official version of the 2020 Form W-4. See below for what these changes include and what they could mean for employers. 

Employers: Tax Withholding Assistant Tool

To help small businesses calculate the amount of federal income tax to withhold from their employees, the IRS created the helpful tool: Tax Withholding Estimator.

W-4 Form Changes for 2020 Include:

 

  1. A Claim on Dependents. Step 3 of the 2020 W-4 Draft provides an option to claim an allowance of $2,000 per dependent under the age of 17, or $500 for other qualifying dependents if the employee’s income is $200,000 or less ($400,000 or less if married filing separately.)
  2. An Optional Adjustment Request to Federal Withholding. Step 4 of the 2020 W-4 Draft allows employees to optionally withhold:

A. Interest, dividends, retirement or other nonwage income.

B. Itemized or other deductions for the household, other than the standard deductions.

C. Employee’s determine the amount of federal income they wish to withhold.

3. Another change to this step of the 2020 IRS Form W-4, step 4 does not currently contain the option of entering income from multiple sources of income. Instead, step 2 now instructs employees to use the IRS calculator or the attached worksheets to estimate further withholding requirements. Employees would now enter that amount as “additional amount you want withheld in each pay period” on line C of Step 4.

See the Official W4 2020.

Employer FAQ about the 2020 W-4 Form

Below are actual Employer Questions to the IRS and the IRS’s Response. 

Ask your Question

Are new employees that start after Jan 1, 2020 required to fill out the redesigned form?

Yes. All new employees first paid after 2019 must use the redesigned form. Similarly, any other employee who wishes to adjust their withholding must use the redesigned form. 

How should we treat new employees beginning employment after 2019 who choose not complete a Form W-4?

New employees first paid after 2019 who fail to furnish a Form W-4 will be treated as a single flier with no other adjustments. (See Full IRS Answer)

Are there computer programs available to help my employees complete the W-4 Form accurately?

Yes. The Tax Withholding Estimator is available at irs.gov/W4app Your employees should consider using the withholding estimator if they:

• expect to work only part of the year (this does not apply if you are only switching jobs),

• had a large balance due or refund last year and it is no longer the beginning of the current year,

• have dividend or capital gain or are subject to additional taxes, such as the additional Medicare tax,

• have self-employment income,

• prefer the most accurate withholding for multiple job situations, or

• prefer to limit information provided in Steps 2-4, but do not want to sacrifice accuracy.  

If a current employee paid prior to 2020 wants to adjust withholding from their pay dated January 1, 2020 or later, do they have to fill out the new W-4 Form?

Yes. They must use the redesigned form. 

May I ask all of my employees paid before 2020 to furnish new Forms W-4 using the redesigned version of the form?

Yes, you can ask they complete the new form, BUT as part of the request you should explain that:

  1. they are not required to furnish a new Form W-4, and
  2. if they do not furnish a new Form W-4, withholding will continue based on a valid form previously furnished.  (See Full IRS Answer)

Are all employees required to furnish a new Form W-4?

No. Employees who have furnished Form W-4 in any year before 2020 are not required to furnish a new form merely because of the redesign. Employers will continue to compute withholding based on the information from the employee’s most recently furnished Form W-4. (See Full IRS Answer)

What happened to withholding allowances?

  1. Allowances are no longer used for the redesigned Form W-4. This change is meant to increase transparency, simplicity, and the accuracy of the form. (See Full IRS Answer)

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The 3 P’s of Effective Employee Training

Posted on by try HRIS

All of us learn and absorb information in different ways. Some retain information with repetitive study and quiz taking. Some of us can hear something once and can recall it months later. Most of us are interactive or visual learners. This is the category 93% of Americans (myself included) fall in. 

Effective methods of Employee training

Case in Point:

Years ago, my son came home from school excited to tell me about his health class that day. The school had a guest presenter visit and his topic was how easily people can transmit germs.

My son proceeded to tell me how the instructor introduced himself and then shook hands with a student. He then asked the student to shake the hand of the next student and so on, until all 37 students had shaken hands. The instructor continued his lecture explaining the importance of careful body contact; how easily germs and diseases spread. (I’m sure by now you’ve realized the point of this health class lecture.)

At the end of the lecture the instructor pulled out a black light and held up his hand, revealing a glowing palm. He passed the light around, which illuminated the same glow on every hand down to the last hand-shaking student. The point of the exercise was not missed by the students, and years later my son still recalls this ‘training’. 

Imagine training that engages your employees this way.

The 3 P's of Effective Employee Training

P1: Planning (The Who and the What)

The first step to planning effective training is establishing requirements, goals and strategy. Training programs should guide and develop your employees, so they not only meet, but exceed company expectations. Begin by identifying which departments, positions or individuals must become certified to stay compliant. Next, identify specific departments or individuals who will be most likely to benefit the company with informative training. Optimally, the courses or lessons you provide will develop your staff to accomplish not only industry requirements, but specific company goals as well. 

Now that you’ve identified compliance requirements, which departments or individuals should/must complete training and set your annual goals, you can prepare the strategy that will lay a foundation for your training program.

business goals for employee training and retention

P2: Preparation (The When and the Where)

Let’s breakdown the science of a training strategy. 

First, the when. Certain industry regulations require specific time frames for training to be completed (see New York’s harassment training requirements), while others just require specific training on an annual basis. If your industry or staff has licensing requirements with exams (HR, Nurses, OSHA and such) place those ‘required by dates’ on a calendar and decide if additional, relevant training could help prepare your staff to pass these exams. (This has the potential to improve employee retention as your staff will feel grateful and appreciate the consideration/recognition.)

If your company is fortunate enough not to have required training, an effective learning program will still greatly benefit your bottom line. To determine areas of improvement, evaluate the gross and net income analytics at the end of your fiscal year. Determine which areas, departments or individuals may be able to improve based on previous performance. (Perhaps your customer service representatives could save more callers if they learned how to diffuse difficult customers or possibly save more on workman’s comp but providing additional safety training). An improvement training program should be designed and scheduled prior to the 1st of the New Year. 

fiscal year end employee training plan

Second, the where. Work environments, atmosphere and culture can help you determine the most effective setting for your employee training. 

Office environments typically employ individuals that operate at their own pace and schedules throughout the day. Effective training in this scenario will most likely utilize individual online courses, so employees can determine their individual completion timeframe. They will also appreciate you considering their schedules and avoiding disruption.

Warehouses, Contractors and Retail are set up to have their staff engage with not only each other, but with consumers as well. For certain departments, individual training could work best, although most of these industry employees may prefer group training sessions. Especially if pizza is provided.

Remote employees can be difficult to train effectively, but online courses with progress tracking can greatly improve productivity and participation. To encourage training or teamwork, consider offering a gift card or other relevant surprise if all remote employees finish the training by a certain date. This will encourage them to encourage each other and help to form positive remote co-worker relationships.

A forth option is live training. This is best suited for large corporations, seminar events or when mandatory to satisfy requirements (such as the practical compliance training for OSHA forklift operator safety.) This type of training can require a significant investment of research and funds to find and hire qualified instructors. In contractor-based industries there are many reputable equipment companies who will provide hands on equipment training with the purchase of equipment, though the company still must provide written training as per compliance. Additionally, you should be aware that live training will likely involve longer paid workday hours for employee training.

Examine your company culture and environment to determine the most effective setting, which will help narrow down the best type of training. Consider which will be the most conducive, efficient and ultimately the most effective for your employees. 

forklift safety training for employees

P3: Presentation (The How)

We’ve have now narrowed down the exact aim for your training. You know who requires it and those who will benefit from it. You know what type of training will be best suited for your work culture and budget. You know when required training is due and when you would like to employ informative programs. You also know which setting will best suit your company culture, albeit the classroom, online or presentation. Let’s talk about how to initiate.

How do I know if the employee training will be effective?

No matter the type of training you’ve decided will work best for your company, the training itself must effectively impact your employees. If you remember the story above about the Health Class, you’ll recall the students involved remembered the lesson and took the information to heart. The most effective type of training is 1. Retainable 2. Interactive. 3. Rewarding. 

Retention: Visual aids, real life situations and interactive Q&A effectively engage participation. Drawn out lectures on the other hand, do not. Training sessions or courses should stay under an hour, or with an allowed break if state regulations require additional time requirements. Seminars follow their own rules, as these can be even be week-long events. These longer events, such as the upcoming Las Vegas SHRM event or Digital Marketing Conference, can highly benefit HR Professionals or Marketing Directors stay up to date with market trends and latest tactics if you are a larger company with these needs. For normal employee training courses, the completion timeframe should be reasonable. If you keep attention, you keep retention.

las vegas shrm convention

Interaction: Ensure your employees are able to engage with the training. Engagement can be satisfied many ways, from Q&A, short quizzes, teamwork, a practical test (such as on machines, equipment or customer conversation), storytelling or visual aids.  

effective training with q&a

Rewarding: Satisfying this part of effective training doesn’t require another monetary contribution from the company. Completion certificates themselves offer recognition when presented in a meaningful way. Even businesses on a tight budget have been known to become creative with reward systems, including ringing a bell, allowing an additional 15 minutes for their lunch break, framing the certificate, celebrating with an announcement or even pausing during a company meeting for a congratulations and a handshake… just be sure to wash your hands first. 

New Employee Toolkit; Hire Right

When you’re ready to employ effective employee training, we hope this guide provides a starting point to the process. If you’re stuck on one of these 3 P’s, tryHRIS provides a Training Advisor consultation and a custom-built company training program when you purchase any course.

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