States are Preparing for the Tax Cut changes in the Federal Withholding

Several states either use the Federal Form W-4 or allow employees to use it instead of the state form. As a result some states have changed their W-4 equivalent to meet the changes coming in 2020 and no longer use the Federal form.

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State Updates

  • Missouri who has a new version of Form MO-W-4, Employee’s Withholding Certificate, and has posted a notice on the Missouri website to ensure employers will be aware of this change.

  • Oregon has a new Form OR-W-4, Oregon Employee’s Withholding Allowance Certificate, and advises employers to begin using this form for all new hires and to recommend to existing employees that used the Federal Form W-4 to complete this form or they might be under withheld for taxes in 2019.

  • Montana employers have been instructed to begin using the 2019 Form MW-4, Montana Employee’s Withholding Allowance and Exemption Certificate, as a replacement for the Federal Form W-4.  Also, Montana recommended employers to have new hires and employees who currently claim exempt on the Federal Form complete the new form.

  • Idaho has replaced the Federal Form W-4 for 2019 with Form ID W-4, Idaho Employee’s Withholding Allowance Certificate.  The form requires the employee to indicate the number of state exemptions next to the number of Federal exemptions.

  • The state of Vermont requires employees to begin using Form W-4VT 2018, Employee’s Withholding Allowance Certificate, instead of the Federal Form W-4.  While the employee may still use the federal form, this could result in under withholding.  The state form did not change for 2019.

Other states that use the Federal Form W-4 and have not made changes to add a new state form are Colorado, Delaware, Nebraska, New Mexico, North Dakota, South Carolina and Utah.

Employers should begin to use these new forms and instruct any employees that would need to complete a new state form as soon as possible to prevent employees from being under withheld on taxes. Look for more change to come by 2020.

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Payroll and Benefits Administrator Katie Thompson, Heartland Coop

Great customer support. I have enjoyed the annual conferences as well and Optimum is very good about keeping us up-to-date on things like tax changes.