The IRS Publication 15-T (also known as Pub 15-T) consists of Federal Income Tax Withholding Methods. It also supplements Publication 15 (Employer’s Tax Guide) and Publication 51 (Agricultural Employer’s Tax Guide). In the publication, you will find information related to methods of withholding using the Percentage Method or Wage Bracket Method.
In this article, you will learn in general about IRS Publication 15-T and the contents present inside the publication. Then, you will also learn when and how to use this document for your benefit. This will act as a useful tax guide while you are making tax returns. Hence, to learn more about this tax document, read on through to the end of the article.
What Is IRS Publication 15-T?
According to IRS.gov,
“This publication supplements Pub. 15, Employer’s Tax Guide, and Pub. 51, Agricultural Employer’s Tax Guide. It describes how to figure withholding using the Wage Bracket Method or Percentage Method describes the alternative methods for figuring withholding and provides the Tables for Withholding on Distributions of Indian Gaming Profits to Tribal Members.”
Basically, this document is a supplement to IRS Publication 15. Here, you will get information regarding how to withhold supplemental wages. You can use this IRS Publication 15-T in certain situations when you find out how much federal income tax you can withhold on supplemental wages. However, as per Publication 15-T, you cannot use this publication’s methods in these two cases:
- When the 37% mandatory withholding applies to the federal income tax withholding or
- If you use the 22% optional flat rate method to figure out federal income tax withholding.
(If you want to learn more about the withholding rules on supplemental wages, you must check Section 7 of IRS Publication 15.)
What Is The IRS Publication 15?
The IRS Publication 15 is a tax guide for employers that the Internal Revenue Service of the United States publishes. It consists of a variety of details regarding the responsibilities of the employer, which the latter must maintain while filling and reporting tax information of the business’s employees. This publication is also known as Circular E.
According to Investopedia,
“IRS Publication 15 is used to determine federal income tax, but not state or local taxes. The Tax Guide details federal income tax amounts for payroll withholdings, including Medicare and Social Security amounts. Employers should refer to their state’s tax rules to ensure that proper state income tax amounts are withheld from employees’ paychecks.”
The document consists of all the essential rules. Some of them include how to deposit, withhold, report, correct, and pay taxes that the employees owe to the government. However, the rules in this document are not applicable to the corporation itself.
This employer’s guide came out in 2020. It removed two major withholding tables, the Percentage Method Tables and Wage Bracket Method Tables. Since the IRS removed these tables from the main document of IRS Publication 15, the IRS supplemented the document with Publication 15-T. You can find the tables in the document now.
Apart from that, there is also Publication 15-A (Employer’s Supplemental Tax Guide). This one contains detailed and specialized tax information related to employment. There is another supplementary publication named Publication 15-B (Employer’s Tax Guide to Fringe Benefits). It contains information for employers on the treatment of tax on the fringe benefits for employees.
In this latter publication (that is, IRS Publication 15-T), all the Federal Income Tax Withholding Methods are present. However, if you want a practical guide for tax withholding, there is a helpful Tax Withholding assistant available for employers on the IRS official website. It helps employers to figure out tax withholding for employees.
What Is The Use Of Publication 15-T?
As already discussed, the IRS Publication 15-T is a supplement of the IRS Publication 15. Publication 15 is there to inform employers of the various tax withholding abilities for the employees. On the other hand, publication 15-T provides the methods that employers can apply at the time of tax withholding for employees’ tax returns.
To add further information on tax withholdings as per IRS Publication 15 and IRS Publication 15-T, withholdings are available for periodic payments as well. Periodic payments are those payments that employers make to employees and pensioners at regular intervals over a period extending one year. The payments can be monthly, quarterly, annually, etc.
According to IRS Publication 15-T document,
“Although this publication is used to figure federal income tax withholding on periodic payments of pensions and annuities, the methods of withholding described in this publication can’t be used to figure withholding on nonperiodic payments or withholding on eligible rollover distributions.”
If you want to know more about various other rules on tax withholding for pensions, annuities, etc., check Section 8 of Publication 15-A.
How And When To Use The IRS 15-T Publication?
The best way to access the IRS Publication 15-T is by using the online source, that is, by going to the official IRS website. However, make sure that you have carefully gone through IRS Publication 15 first, as 15-T is just a supplement to it.
Once you know the rules of tax withholding as given in IRS Publication 15, then you must use the withholding methods as given in IRS Publication 15-T. You can also use IRS Publication 15-A, and IRS Publication 15-B, as per your needs.
There is also a tax assistant on the IRS website that can help you in using the right methods for tax withholding as per IRS Publication 15. Apart from that, if you want any updates or new legal changes on tax withholding laws, you can find them on the IRS website.
Hope this article was helpful for you in getting a better idea of what is inside IRS Publication 15-T. You can see from this article that this publication contains supplementary information to IRS Publication 15. Apart from that, other supplementary information is also contained in IRS Publication 15-A and IRS Publication 15-B.
Publication 15-T contains all the methods of withholding taxes, that is, the ways through which employers can figure out how to withhold taxes related to employees. What do you think can changes be made to tax withholding laws to make it simpler? Share your ideas and opinions with us in the comments section below.