The IRS has published Notice 2018-14 which extends the effective period of 2017 Form W-4, for those claiming exempt from federal income tax withholding. The 2017 Form W-4 expiration date has been extended from February 15, 2018 to February 28, 2018. Therefore, please do not perform the annual federal tax withholding reset to the single/zero default until February 28, 2018. If employees complete a W-4 in 2018 claiming exempt, they do not need to be reset to the single/zero default.
The IRS has not published an official 2018 Form W-4. They are allowing 2017 Forms (marked as 2018) to be used in 2018 until the updated form is published. As such, the version of the W-4 Form available via YES indicates that it is for 2018.
This IRS extension does not impact those employees claiming exempt from state income tax withholding in 2017. Those employees needed to complete a 2018 Form A-4 by January 1, 2018 to continue to be treated as exempt from state income tax withholding in 2018.
If you have any questions, please contact [email protected].