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Change your tax withholdings

Change your federal or state tax withholdings at any time in your Gusto account. 

To make withholding more accurate, as of January 1, 2020, the IRS has a new Form W-4.

  • To make changes to your withholdings, you'll need to complete all steps in your Gusto account related to this new IRS form. 

Check out our blog to learn more about how to fill out the new form. 

The IRS’ worksheet, withholding estimator, and FAQs can also be used as helpful resources when determining your 2020 federal tax withholdings.

  1. Click the Job & Pay tab.
  2. Next to Federal Taxes or State Taxes, click Edit.
  3. Enter your federal or state filing status.
    • If you claim ‘Exempt from withholding’, Gusto will not withhold federal income tax from your wages but all taxable wages will still be reported on the W-2.
  4. For the most accurate withholding, fill in any additional applicable fields.
    • If you add an additional amount of wages to be withheld, that amount will be withheld on each payroll processed thereafter - up until the amount is removed from your Gusto profile.
  5. Click Save.

The information entered will be used to calculate your federal or state withholding tax on future payrolls. If you've updated your federal withholdings, a new Form W-4 will be created and you'll be prompted to e-sign.

Keep in mind: Since tax rules change over time and can vary by location and industry, consult a CPA or tax advisor for specific guidance. 

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