The significant difference between the two forms is that in Form W-4 2020, instead of claiming withholding allowances, employees can claim dependents and other deductions to reduce federal income tax.
Also, choosing the new form reduces complexity and makes sure that your employee’s withholding is done simpler with more accuracy and transparency.
While the new form is quite similar to the old one in its design, it replaces complicated worksheets with more straightforward questions that make withholding computations accurate and easier for employees.
But there is something you must note, only new hires, as of Jan 1, 2020, and employees with changes in their withholdings must submit the 2020 form W-4. Otherwise, employers can retain the 2019 W-4 of employees.
123PayStubs supports both the 2019 and 2020 forms for federal withholding calculations.
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