WASHINGTON — The Internal Revenue Service plans to introduce a second W-4 form, giving taxpayers two choices of how to calculate the amount of federal income tax withheld from their paychecks, an IRS official said Friday.
The IRS, peppered with complaints since unveiling a new four-page W-4 package last November, promised that the second form, to be introduced on Monday, will be considerably less confusing.
The official, who spoke on condition of anonymity, said every employee would be allowed to choose which form to use.
Less Risk in Long Form
For millions of taxpayers, the longer form would increase chances that the taxes withheld would be close to their actual tax liability.
The shorter version would be much easier to calculate but, the official said, there would be a greater chance that too much or too little tax would be withheld, especially for those with non-wage income.