Form W-4 is required when an employee begins work with an employer and federal income tax withholding must be applied to wages. The form establishes the withholding information an employer needs in order to calculate federal income tax deductions from pay.
Requirement at the Start of Employment
When an individual is hired as an employee, the employer is required to withhold federal income tax from wages unless an exception applies. Form W-4 is used at this stage to obtain the information necessary to apply withholding rules correctly from the first payroll period.
Situations That Trigger a New Requirement
A new Form W-4 is required when an employee’s existing withholding information is no longer applicable. This occurs when withholding needs to be recalculated based on updated information provided by the employee rather than continuing to rely on a prior form.
Employer Use of the Form
Employers rely on Form W-4 to determine how withholding tables and formulas are applied to wages. Without a valid Form W-4 on file, employers must apply default withholding rules prescribed by the Internal Revenue Service.
Relationship to Federal Withholding Rules
The requirement to provide Form W-4 arises from federal withholding regulations. The form does not create the withholding obligation itself but serves as the mechanism through which withholding information is communicated and applied.