January 18, 2018

January 18, 2018

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January 17, 2018

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January 16, 2018

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IRS Publishes 2018 Withholding Tables

Earlier today the IRS issued new withholding tables for 2018, along with an explanatory news release and a frequently asked questions document. The new tables reflect changes made by the tax reform legislation enacted last month. Employers should begin using the new tables as soon as possible, but not later than February 15.

The new tables are designed to work with existing Forms W-4, but the IRS intends to revise Form W-4 to reflect the legislative changes, including the increase in the standard deduction and the elimination of personal exemptions. Some employees, particularly employees who itemize deductions, may need to elect additional withholding to avoid being under-withheld under the new tables.

The guidance also clarifies that the new withholding rates for supplemental wages are 22% (for supplemental wages below $1 million) and 37% (for supplemental wages in excess of $1 million).

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Partner

Mary B. "Handy" Hevener is a partner in Morgan Lewis's Employee Benefits and Executive Compensation Practice. Ms. Hevener focuses her practice on benefits provided to employees and independent contractors outside of qualified retirement plans, including stock options and other stock-based compensation; executive income deferrals; golden parachutes; and a range of fringe benefits, from health and life insurance to employee loans, cars, planes, and prizes.

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William P. Zimmerman, Morgan Lewis Law firm, Tax Practice Attorney
Partner

William P. Zimmerman is a partner in Morgan Lewis's Tax Practice. Mr. Zimmerman’s practice focuses on the creation and operation of private and pooled investment vehicles, including mutual funds, hedge funds and other investment-related vehicles. He also has a significant background in advising clients on general corporate and individual tax planning matters, including reorganizations, mergers, acquisitions, spin-offs, recapitalizations and workouts.

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