Circular E 2021 Withholding Tables – Almost all employers have the responsibility for the income-related taxes of their employees. These responsibilities are including to report, correct, pay, deposit, and withhold the employment taxes which are mentioned and explained in Circular E 2021.
What is Circular E?
Circular E is published under its formal name, IRS Publication 15: Employer’s Tax Guide. It is a document issued by the Internal Revenue Service (IRS) which explains the responsibilities of employers to file and report employment taxes, ranging from reporting, correcting, paying, depositing, and withholding their employees’ taxes, instead of the corporate taxes. The updated version of Circular E, or also typically referred to as Publication 15, contains the most recent information regarding the mentioned information above.
Circular E 2021, which at this point is still drafted, will be able to be accessed through the IRS official website. It includes new updates and governmental adjustments related to the employers.
Besides the information above, Publication 15 also includes:
- Employer Identification Numbers (EIN) information
- Social Security Numbers (SSN) information
- Legitimate definitions about employee
- Employment and payment for family employees
- Details about wages and employee’s compensations
- Explanation about reporting and paying tips
- Description About additional wages
- Period of paychecks
- Individual tax withholding
- Earned Income Credit (EIC) notices for employees
- Tax deposits
- Steps to file 941 and 944 forms
- Steps to report changes on 941 and 944 forms
- Information about Federal Unemployment Tax (FUTA)
What is The Purpose of Circular E?
Circular E 2021 document is used to establish and inform about federal income tax, instead of local or state taxes. This guide explains the amount of federal withholding for payroll tax, such as Social Security and Medicare. This document is what should be used as references for employers if they want to make sure to pay the accurate amount of withheld income tax.
Amongst the most essential features inside Circular E, there is an income tax withholding section about tables of Percentage Method and Wage Bracket Method. These brackets are used by an employer to know the employees’ payroll percentage that must be withheld each paycheck according to the federal regulations. It also explains about W4 Form which is determined the amount of withheld tax, as well as the consequences if the particular form is not filed on time.
READ ALSO: Federal Withholding Tables 2021.
How to Access IRS Circular E?
Employer’s Tax Guide is accessible through the official website of IRS. Its electronic version can be downloaded in the format of a PDF file – as it does with the majority of IRS publications.
Publication 15 is a document used for the guide, thus it doesn’t need to be filled like a form. However, it contains a legitimate version and formatting of various documents such as the W4 form. Keep in mind that IRS only accepts the official printed form of these documents or the versions with consistent formatting that do not impact the form processing adversely.
IRS Circular E 2021 Withholding Tables Download
Frequently Asked Questions (FAQ) & Answers
Is There A New Version Of 2021 Circular E?
Yes, but for now it’s still in the form of the draft which the finalized version is to be released soon earlier this year.
Where Can I Check And Get The Latest Version Of Circular E?
You may visit Publication 15 official website of IRS at https://www.irs.gov/forms-pubs/about-publication-15.
Where Can I Ask Question That’S Not Available On Publication 15?
You may contact IRS via toll-free phone number at 866-455-7438, toll call phone number at 304-263-8700, or 304-579-4827 for physically-challenged persons. Alternatively, the IRS can be reached through email as well at [email protected]
Is It Possible To Get Information Within Circular E In Other Languages?
Yes. Currently, IRS provides available information resources not only in English, but also in Spanish, Chinese, Korean, Vietnamese, and Russian.
Circular E 2021 draft is released on November 2020 which contains several adjustments of tax credits regarding COVID-19 and non-COVID-19 matters. The finalized version is planned to be released in January 2021.