What to collect from a new employee
IRS Publication 15 says to ask all new employees for a signed Form W-4 when they start work and to make it effective with the first wage payment. New hires must use the current, redesigned form, which has five steps.
| Step | What the employee enters | Effect on withholding |
|---|---|---|
| 1 | Name, filing status and other personal details | Sets the standard deduction and tax tables used |
| 2 | Multiple jobs or a working spouse: the Step 2(c) box or an extra amount in 4(c) | Raises withholding |
| 3 | The annual amount of credits they will claim | Lowers withholding |
| 4 | Other income (4a), deductions (4b), extra withholding each paycheck (4c) | Raises or lowers it |
| 5 | Signature | None: it certifies the form; ask for a signed one |
Employees who fill in only Steps 1 and 5 get withholding on their filing status alone. An employee can't ask for a fixed dollar amount or a percentage instead of the form's figures; they can only add an extra amount in Step 4(c).
What if an employee doesn't give you a W-4?
Withhold as if they had checked Single or Married filing separately in Step 1(c) and made no entries in Steps 2, 3 or 4. That applies to a rehired employee who doesn't give you a new form too.
There is one exception. An employee first paid before 2020 who never gave you a Form W-4 stays at single with zero allowances on the 2019 form. Publication 15-T's optional computational bridge lets you treat that as Single with $8,600 in Step 4(a).
Invalid and exempt forms
- Any unauthorized change or addition makes a Form W-4 invalid, including striking out the certification. So does one the employee clearly shows is false when they hand it to you.
- You may treat a form as invalid if the employee wrote "exempt" and also checked Step 2(c) or filled in Step 3 or 4.
- A homemade form designed by the employee counts as no form at all. A substitute you design is allowed only if it matches the IRS form's wording and comes with its instructions and worksheets.
- With an invalid form, don't use it. Tell the employee and ask for a new one; meanwhile keep using their last valid form, or withhold as single with no adjustments if there isn't one.
An employee can claim exemption from federal income tax withholding if they owed no tax last year and expect to owe none this year. The claim lasts only for the calendar year: they need to give you a new form by February 15 to stay exempt, or you withhold as single with no adjustments. Social security and Medicare are still withheld from an exempt employee.
Changes, older forms and IRS letters
- When an employee gives you a new W-4, start using it no later than the first payroll period ending on or after the 30th day after you get it. Don't adjust withholding for earlier periods.
- A W-4 from 2025 or earlier stays in effect for 2026 until the employee gives you a new one. You can ask someone with a pre-2020 form to fill in the new one, but explain they don't have to.
- The IRS can ask you to send it copies of W-4s. If it sends a lock-in letter for an employee, give them their copy within 10 business days and withhold as the letter says from the date it gives. Ignore a later W-4 that would withhold less.
- Keep W-4s with your employment tax records for at least 4 years.
How the W-4 changes a paycheck: a worked example
Federal income tax on a $2,000 paycheck every two weeks in 2026, worked out by the Publication 15-T percentage method for each Form W-4 below. Social security ($124.00) and Medicare ($29.00) are the same in every case.
| Form W-4 | Federal income tax |
|---|---|
| Single, Steps 1 and 5 only (also: no W-4 given) | $156.15 |
| Married filing jointly, no other entries | $76.15 |
| Head of household, no other entries | $114.92 |
| Single, Step 2(c) box checked | $270.19 |
| Single, $2,200 of credits in Step 3 | $71.54 |
| Single, $25 extra in Step 4(c) | $181.15 |
| 2019 form: single, zero allowances | $195.85 |
| Exempt | $0.00 |
For the first row: $2,000 × 26 = $52,000 a year, less $8,600 is $43,400. The 2026 single table gives $1,240 plus 12% of the amount over $19,900, which is $4,060 for the year, or $156.15 a paycheck.
Sources: IRS Publication 15 (2026) section 9 and Publication 15-T (2026), read on October 8, 2026. State income tax withholding follows each state's own rules. This page is general information, not tax advice.
Where the W-4 shows on a pay stub
The W-4 itself isn't printed on the stub, but its result is the federal income tax line. Many stubs also show the filing status used, so an employee can spot a W-4 that needs updating. In the PayDocs pay stub generator, the tax settings ask for the same filing status and Step 2 answers. PayDocs works out federal income tax, Social Security, Medicare and supported state taxes for 2026 pay dates (see what we calculate).
Questions
Do employers have to collect a W-4?
You ask every new employee for a signed Form W-4 when they start. If they don't give you one, you don't stop paying them: you withhold as if they were single or married filing separately with no other entries.
Do employers send Form W-4 to the IRS?
No, not as a routine. You keep the forms with your employment tax records for at least 4 years and send copies only if the IRS asks for them in a notice or published guidance.
Do employees with an old W-4 need a new one?
No. A form from 2019 or earlier stays valid until the employee chooses to change it. Anyone hired now, or changing their withholding, uses the current form.
How long does a W-4 claiming exempt last?
Only the calendar year it is given. To stay exempt the employee gives you a new form by February 15; otherwise you withhold as single or married filing separately with no adjustments.
When does a new W-4 take effect?
No later than the first payroll period ending on or after the 30th day after you receive it. You don't go back and change withholding for paychecks already paid.
What makes a W-4 invalid?
Any unauthorized change or addition, such as crossing out the certification, or a form the employee clearly shows is false. You may also treat "exempt" combined with entries in Steps 2 to 4 as invalid.
Sources
- IRS — Publication 15 (2026), (Circular E), Employer's Tax Guide: section 9, Form W-4
- IRS — Publication 15-T (2026), Federal Income Tax Withholding Methods
Official sources checked October 8, 2026. This guide explains how pay documents work; it is not tax or legal advice.
