2021 Publication 15-A - IRS

1 Userid: CPMS chema: tipxLeadpct: 100%Pt. size: 10 Draft Ok to PrintAH XSL/XMLF ileid: .. tions/P15A/2018/B/XML/Cycle04/source(Ini t. & Date) _____Page 1 of 73 16:03 - 21-Feb-2018 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before of the TreasuryInternal Revenue ServicePublication 15-ACat. No. 21453 TEmployer's Supplemental Tax Guide(Supplement to Pub. 15, Employer's Tax Guide)For use in 2018 Get forms and other information faster and easier at: (English) (Espa ol) ( ) ( ) (Pусский) (Ti ngVi t) ContentsWhat's Who Are Employees?..52. Employee or Independent Contractor?..73. Employees of Exempt Religious Exemptions and Special Rules for Wages and Other Sick Pay Special Rules for Paying Pensions and Alternative Methods for Figuring Tables for Percentage Method Withholding (for Automated Payroll Systems)..26 Wage Bracket Percentage Method Tables (for Automated Payroll Systems).

2 31 Combined Federal Income Tax, Employee Social Security Tax, and Employee Medicare Tax Withholding Tables for Withholding on Distributions of Indian Gaming Profits to Tribal To Get Tax DevelopmentsFor the latest information about developments related to Pub. 15-A, such as legislation enacted after it was published, go to 's New2018 federal income tax withholding. This Publication includes the 2018 Formula Tables for Percentage Method Withholding; Wage Bracket Percentage Method Tables; Combined Federal Income Tax, Employee Social Security Tax, and Employee Medicare Tax Withholding Tables; and Tables for Withholding on Distributions of Indian Gaming Profits to Tribal Members. The 2018 withholding tables incorporate changes to the individual tax rates based on tax legislation enacted on December 22, 2017 ( 115-97). The new withholding tables are designed to work with the Forms W-4, Employee s Withholding Feb 21, 2018 Page 2 of 73 Fileid.

3 Tions/P15A/2018/B/XML/Cycle04/source16:0 3 - 21-Feb-2018 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before Certificate, that your employees previously gave you. For more information about the 2018 Form W-4, see What s New in Pub. allowance. The 2018 amount for one with-holding allowance on an annual basis is $4, expense reimbursements. Section 11048 of 115-97 suspends the exclusion for qualified moving expense reimbursements from your employee s income for tax years beginning after December 31, 2017, and be-fore January 1, 2026. However, the exclusion is still avail-able in the case of a member of the Armed Forces on active duty who moves because of a permanent change of station. The exclusion applies only to reimbursement of moving expenses that the member could deduct if he or she had paid or incurred them without reimbursement.

4 See Moving Expenses in Pub. 3, Armed Forces Tax Guide, for the definition of what constitutes a permanent change of station and to learn which moving expenses are achievement awards. Section 13310 of 115-97 defines items that aren t tangible personal prop-erty for purposes of employee achievement awards. Tan-gible personal property doesn t include cash, gift cards, and other nontangible personal property. See Employee Achievement Awards in section section 83(i) election. Section 13603 of 115-97 added new section 83(i) to the Internal Revenue Code. Under section 83(i), qualified employees who are granted stock options or restricted stock units (RSUs) and who later receive stock upon exercise of the option or upon settlement of the RSU (qualified stock) may elect to defer the recognition of income for up to 5 years if certain requirements are met. An arrangement under which an employee may receive qualified stock (as defined in sec-tion 83(i)(2)) isn t treated as a nonqualified deferred com-pensation (NQDC) plan with respect to such employee solely because of such employee s election, or ability to make an election, to defer recognition of income under section 83(i).

5 Social security and Medicare tax for 2018. The social security tax rate is each for the employee and em-ployer, unchanged from 2017. The social security wage base limit is $128, Medicare tax rate is each for the employee and employer, unchanged from 2017. There is no wage base limit for Medicare security and Medicare taxes apply to the wages of household workers you pay $2,100 or more in cash wa-ges in 2018. Social security and Medicare taxes apply to election workers who are paid $1,800 or more in cash or an equivalent form of tax relief. Disaster tax relief was enacted for those impacted by Hurricane Harvey, Irma, or Maria. Ad-ditionally, the IRS has provided special relief designed to support employer leave-based donation programs to aid the victims of these hurricanes and to aid the victims of the California wildfires that began October 8, 2017. For more information about disaster relief, including the treat-ment of amounts paid to qualified tax-exempt organizations under employer leave-based donation pro-grams, see Pub.

6 Opportunity tax credit for qualified tax-exempt organizations hiring qualified veterans. The work op-portunity tax credit is available for eligible unemployed veterans who begin work on or after November 22, 2011, and before January 1, 2020. Qualified tax-exempt organi-zations that hire eligible unemployed veterans can claim the work opportunity tax credit against their payroll tax lia-bility using Form 5884-C. For more information, go to program for professional employer or-ganizations. The Tax Increase Prevention Act of 2014 required the IRS to establish a voluntary certification pro-gram for professional employer organizations (PEOs). PEOs handle various payroll administration and tax re-porting responsibilities for their business clients and are typically paid a fee based on payroll costs. To become and remain certified under the certification program, certi-fied professional employer organizations (CPEOs) must meet various requirements described in sections 3511 and 7705 and related published guidance.

7 Certification as a CPEO may affect the employment tax liabilities of both the CPEO and its customers. A CPEO is generally treated as the employer of any individual who performs services for a customer of the CPEO and is covered by a contract described in section 7705(e)(2) between the CPEO and the customer (CPEO contract), but only for wages and other compensation paid to the individual by the CPEO. For more information, go to Also, see Revenue Procedure 2017 14, 2017-3 426, availa-ble at # 8922 replaced the Third-Party Sick Pay Re-cap Form W-2. Form 8922 replaces the Third-Party Sick Pay Recap previously done on Form W-2. For more information, see Form 8922, Third-Party Sick Pay Recap in section premium assistance credit. Effective for tax periods beginning after December 31, 2013, the credit for COBRA premium assistance payments can't be claimed on Form 941, Employer's QUARTERLY Federal Tax Re-turn (or Form 944, Employer's ANNUAL Federal Tax Re-turn).

8 Instead, after filing your Form 941 (or Form 944), file Form 941-X, Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund (or Form 944-X, Adjusted Employer's ANNUAL Federal Tax Return or Claim for Re-fund) to claim the COBRA premium assistance credit. Fil-ing a Form 941-X (or Form 944-X) before filing a Form 941 (or Form 944) for the return period may result in errors or delays in processing your Form 941-X (or Form 944-X). For more information, see the Instructions for Form 941 (or the Instructions for Form 944) or go to federal income tax withholding on disability pay-ments for injuries incurred as a direct result of a ter-rorist attack directed against the United States. Page 2 Publication 15-A (2018)Page 3 of 73 Fileid: .. tions/P15A/2018/B/XML/Cycle04/source16:0 3 - 21-Feb-2018 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before payments (including Social Security Disability Insurance (SSDI) payments) for injuries incurred as a di-rect result of a terrorist attack directed against the United States (or its allies) aren't included in income.

9 Because federal income tax withholding is only required when a payment is includable in income, no federal income tax should be withheld from these of marriage. A marriage of two individuals is recognized for federal tax purposes if the marriage is rec-ognized by the state, possession, or territory of the United States in which the marriage is entered into, regardless of legal residence. Two individuals who enter into a relation-ship that is denominated as marriage under the laws of a foreign jurisdiction are recognized as married for federal tax purposes if the relationship would be recognized as marriage under the laws of at least one state, possession, or territory of the United States, regardless of legal resi-dence. Individuals who have entered into a registered do-mestic partnership, civil union, or other similar relationship that isn't denominated as a marriage under the law of the state, possession, or territory of the United States where such relationship was entered into aren't lawfully married for federal tax purposes, regardless of legal payroll tax duties.

10 Generally, you re re-sponsible to ensure that tax returns are filed and deposits and payments are made, even if you contract with a third party to perform these acts. You remain responsible if the third party fails to perform any required action. If you choose to outsource any of your payroll and related tax duties (that is, withholding, reporting, and paying over so-cial security, Medicare, FUTA, and income taxes) to a third-party payer, such as a payroll service provider or re-porting agent, go to for helpful information on this a CPEO pays wages and other compensation to an individual performing services for you, and the services are covered by a contract described in section 7705(e)(2) between you and the CPEO (CPEO contract), then the CPEO is generally treated as the employer, but only for wages and other compensation paid to the individual by the CPEO. However, with respect to certain employees covered by a CPEO contract, a customer may also be treated as an employer of the employees and, conse-quently, may also be liable for federal employment taxes imposed or wages and other compensation paid by the CPEO to such must receive written notice from the IRS to file Form 944.