The American Bankers Association urged the IRS yesterday to delay the use of new draft forms W-4P and W-4R, which are used to determine the appropriate amount of federal income tax to be withheld for various types of retirement distributions.
In a letter to the IRS, the association strongly recommended that the implementation of the new forms be delayed until Jan. 1, 2023, and that any penalties imposed for failure to meet the new requirements be waived during the initial change period.
ABA noted selected issues with the new forms including that additional time is needed for process and system changes, design of the elections on the forms related to withholding percentages, customer education and banker training.
