26 U.S.C. § 3402 | Income tax collected at source

(a)

Requirement of withholding

(1)

In general

Except as otherwise provided in this section, every employer making payment of wages shall deduct and withhold upon such wages a tax determined in accordance with tables or computational procedures prescribed by the Secretary. Any tables or procedures prescribed under this paragraph shall—

(A)

apply with respect to the amount of wages paid during such periods as the Secretary may prescribe, and

(B)

be in such form, and provide for such amounts to be deducted and withheld, as the Secretary determines to be most appropriate to carry out the purposes of this chapter and to reflect the provisions of chapter 1 applicable to such periods.

(2)

Amount of wages

For purposes of applying tables or procedures prescribed under paragraph (1), the term “the amount of wages” means the amount by which the wages exceed the taxpayer’s withholding allowance, prorated to the payroll period.

(b)

Percentage method of withholding

(1)

If wages are paid with respect to a period which is not a payroll period, the withholding allowance allowable with respect to each payment of such wages shall be the allowance allowed for a miscellaneous payroll period containing a number of days (including Sundays and holidays) equal to the number of days in the period with respect to which such wages are paid.

(2)

In any case in which wages are paid by an employer without regard to any payroll period or other period, the withholding allowance allowable with respect to each payment of such wages shall be the allowance allowed for a miscellaneous payroll period containing a number of days equal to the number of days (including Sundays and holidays) which have elapsed since the date of the last payment of such wages by such employer during the calendar year, or the date of commencement of employment with such employer during such year, or January 1 of such year, whichever is the later.

(3)

In any case in which the period, or the time described in paragraph (2), in respect of any wages is less than one week, the Secretary, under regulations prescribed by him, may authorize an employer to compute the tax to be deducted and withheld as if the aggregate of the wages paid to the employee during the calendar week were paid for a weekly payroll period.

(4)

In determining the amount to be deducted and withheld under this subsection, the wages may, at the election of the employer, be computed to the nearest dollar.

(c)

Wage bracket withholding

(1)

At the election of the employer with respect to any employee, the employer shall deduct and withhold upon the wages paid to such employee a tax (in lieu of the tax required to be deducted and withheld under subsection (a)) determined in accordance with tables prescribed by the Secretary in accordance with paragraph (6).

(2)

If wages are paid with respect to a period which is not a payroll period, the amount to be deducted and withheld shall be that applicable in the case of a miscellaneous payroll period containing a number of days (including Sundays and holidays) equal to the number of days in the period with respect to which such wages are paid.

(3)

In any case in which wages are paid by an employer without regard to any payroll period or other period, the amount to be deducted and withheld shall be that applicable in the case of a miscellaneous payroll period containing a number of days equal to the number of days (including Sundays and holidays) which have elapsed since the date of the last payment of such wages by such employer during the calendar year, or the date of commencement of employment with such employer during such year, or January 1 of such year, whichever is the later.

(4)

In any case in which the period, or the time described in paragraph (3), in respect of any wages is less than one week, the Secretary, under regulations prescribed by him, may authorize an employer to determine the amount to be deducted and withheld under the tables applicable in the case of a weekly payroll period, in which case the aggregate of the wages paid to the employee during the calendar week shall be considered the weekly wages.

(5)

If the wages exceed the highest wage bracket, in determining the amount to be deducted and withheld under this subsection, the wages may, at the election of the employer, be computed to the nearest dollar.

(6)

December 31, 1969 In the case of wages paid after , the amount deducted and withheld under paragraph (1) shall be determined in accordance with tables prescribed by the Secretary. In the tables so prescribed, the amounts set forth as amounts of wages and amounts of income tax to be deducted and withheld shall be computed on the basis of the table for an annual payroll period prescribed pursuant to subsection (a).

(d)

Tax paid by recipient

If the employer, in violation of the provisions of this chapter, fails to deduct and withhold the tax under this chapter, and thereafter the tax against which such tax may be credited is paid, the tax so required to be deducted and withheld shall not be collected from the employer; but this subsection shall in no case relieve the employer from liability for any penalties or additions to the tax otherwise applicable in respect of such failure to deduct and withhold.

(e)

Included and excluded wages

If the remuneration paid by an employer to an employee for services performed during one-half or more of any payroll period of not more than 31 consecutive days constitutes wages, all the remuneration paid by such employer to such employee for such period shall be deemed to be wages; but if the remuneration paid by an employer to an employee for services performed during more than one-half of any such payroll period does not constitute wages, then none of the remuneration paid by such employer to such employee for such period shall be deemed to be wages.

(f)

Withholding allowance

(1)

In general

Under rules determined by the Secretary, an employee receiving wages shall on any day be entitled to a withholding allowance determined based on—

(A)

whether the employee is an individual for whom a deduction is allowable with respect to another taxpayer under section 151;

(B)

if the employee is married, whether the employee’s spouse is entitled to an allowance, or would be so entitled if such spouse were an employee receiving wages, under subparagraph (A) or (D), but only if such spouse does not have in effect a withholding allowance certificate claiming such allowance;

(C)

the number of individuals with respect to whom, on the basis of facts existing at the beginning of such day, there may reasonably be expected to be allowable a credit under section 24 (determined after application of subsection (j) thereof) for the taxable year under subtitle A in respect of which amounts deducted and withheld under this chapter in the calendar year in which such day falls are allowed as a credit;

(D)

any additional amounts to which the employee elects to take into account under subsection (m), but only if the employee’s spouse does not have in effect a withholding allowance certificate making such an election;

(E)

the standard deduction allowable to such employee (one-half of such standard deduction in the case of an employee who is married (as determined under section 7703) and whose spouse is an employee receiving wages subject to withholding); and

(F)

whether the employee has withholding allowance certificates in effect with respect to more than 1 employer.

(2)

Allowance certificates

(A)

On commencement of employment

On or before the date of the commencement of employment with an employer, the employee shall furnish the employer with a signed withholding allowance certificate relating to the withholding allowance claimed by the employee, which shall in no event exceed the amount to which the employee is entitled.

(B)

Change of status

If, on any day during the calendar year, an employee’s withholding allowance is in excess of the withholding allowance to which the employee would be entitled had the employee submitted a true and accurate withholding allowance certificate to the employer on that day, the employee shall within 10 days thereafter furnish the employer with a new withholding allowance certificate. If, on any day during the calendar year, an employee’s withholding allowance is greater than the withholding allowance claimed, the employee may furnish the employer with a new withholding allowance certificate relating to the withholding allowance to which the employee is so entitled, which shall in no event exceed the amount to which the employee is entitled on such day.

(C)

Change of status which affects next calendar year

If on any day during the calendar year the withholding allowance to which the employee will be, or may reasonably be expected to be, entitled at the beginning of the employee’s next taxable year under subtitle A is different from the allowance to which the employee is entitled on such day, the employee shall, in such cases and at such times as the Secretary shall by regulations prescribe, furnish the employer with a withholding allowance certificate relating to the withholding allowance which the employee claims with respect to such next taxable year, which shall in no event exceed the withholding allowance to which the employee will be, or may reasonably be expected to be, so entitled.

(3)

When certificate takes effect

(A)

First certificate furnished

A withholding allowance certificate furnished the employer in cases in which no previous such certificate is in effect shall take effect as of the beginning of the first payroll period ending, or the first payment of wages made without regard to a payroll period, on or after the date on which such certificate is so furnished.

(B)

Furnished to take place of existing certificate

(i)

In general

Except as provided in clauses (ii) and (iii), a withholding allowance certificate furnished to the employer in cases in which a previous such certificate is in effect shall take effect as of the beginning of the 1st payroll period ending (or the 1st payment of wages made without regard to a payroll period) on or after the 30th day after the day on which such certificate is so furnished.

(ii)

Employer may elect earlier effective date

At the election of the employer, a certificate described in clause (i) may be made effective beginning with any payment of wages made on or after the day on which the certificate is so furnished and before the 30th day referred to in clause (i).

(iii)

Change of status which affects next year

Any certificate furnished pursuant to paragraph (2)(C) shall not take effect, and may not be made effective, with respect to any payment of wages made in the calendar year in which the certificate is furnished.

(4)

Period during which certificate remains in effect

December 31, 1954A withholding allowance certificate which takes effect under this subsection, or which on , was in effect under the corresponding subsection of prior law, shall continue in effect with respect to the employer until another such certificate takes effect under this subsection.

(5)

Form and contents of certificate

Withholding allowance certificates shall be in such form and contain such information as the Secretary may by regulations prescribe.

(6)

Exemption of certain nonresident aliens

1 See References in Text note below.

Notwithstanding the provisions of paragraph (1), a nonresident alien individual (other than an individual described in section 3401(a)(6)(A) or (B)  ) shall be entitled to only one withholding exemption.

(7)

Allowance where certificate with another employer is in effect

If a withholding allowance certificate is in effect with respect to one employer, an employee shall not be entitled under a certificate in effect with any other employer to any withholding allowance which he has claimed under such first certificate.

(g)

Overlapping pay periods, and payment by agent or fiduciary

If a payment of wages is made to an employee by an employer—

(1)

with respect to a payroll period or other period, any part of which is included in a payroll period or other period with respect to which wages are also paid to such employee by such employer, or

(2)

without regard to any payroll period or other period, but on or prior to the expiration of a payroll period or other period with respect to which wages are also paid to such employee by such employer, or

(3)

with respect to a period beginning in one and ending in another calendar year, or

(4)

through an agent, fiduciary, or other person who also has the control, receipt, custody, or disposal of, or pays, the wages payable by another employer to such employee,

the manner of withholding and the amount to be deducted and withheld under this chapter shall be determined in accordance with regulations prescribed by the Secretary under which the withholding allowance allowed to the employee in any calendar year shall approximate the withholding allowance allowable with respect to an annual payroll period.

(h)

Alternative methods of computing amount to be withheld

The Secretary may, under regulations prescribed by him, authorize—

(1)

Withholding on basis of average wages

An employer—

(A)

to estimate the wages which will be paid to any employee in any quarter of the calendar year,

(B)

to determine the amount to be deducted and withheld upon each payment of wages to such employee during such quarter as if the appropriate average of the wages so estimated constituted the actual wages paid, and

(C)

to deduct and withhold upon any payment of wages to such employee during such quarter (and, in the case of tips referred to in subsection (k), within 30 days thereafter) such amount as may be necessary to adjust the amount actually deducted and withheld upon the wages of such employee during such quarter to the amount required to be deducted and withheld during such quarter without regard to this subsection.

(2)

Withholding on basis of annualized wages

An employer to determine the amount of tax to be deducted and withheld upon a payment of wages to an employee for a payroll period by—

(A)

multiplying the amount of an employee’s wages for a payroll period by the number of such payroll periods in the calendar year,

(B)

determining the amount of tax which would be required to be deducted and withheld upon the amount determined under subparagraph (A) if such amount constituted the actual wages for the calendar year and the payroll period of the employee were an annual payroll period, and

(C)

dividing the amount of tax determined under subparagraph (B) by the number of payroll periods (described in subparagraph (A)) in the calendar year.

(3)

Withholding on basis of cumulative wages

An employer, in the case of any employee who requests to have the amount of tax to be withheld from his wages computed on the basis of his cumulative wages, to—

(A)

add the amount of the wages to be paid to the employee for the payroll period to the total amount of wages paid by the employer to the employee during the calendar year,

(B)

divide the aggregate amount of wages computed under subparagraph (A) by the number of payroll periods to which such aggregate amount of wages relates,

(C)

compute the total amount of tax that would have been required to be deducted and withheld under subsection (a) if the average amount of wages (as computed under subparagraph (B)) had been paid to the employee for the number of payroll periods to which the aggregate amount of wages (computed under subparagraph (A)) relates,

(D)

determine the excess, if any, of the amount of tax computed under subparagraph (C) over the total amount of tax deducted and withheld by the employer from wages paid to the employee during the calendar year, and

(E)

deduct and withhold upon the payment of wages (referred to in subparagraph (A)) to the employee an amount equal to the excess (if any) computed under subparagraph (D).

(4)

Other methods

An employer to determine the amount of tax to be deducted and withheld upon the wages paid to an employee by any other method which will require the employer to deduct and withhold upon such wages substantially the same amount as would be required to be deducted and withheld by applying subsection (a) or (c), either with respect to a payroll period or with respect to the entire taxable year.

(i)

Changes in withholding

(1)

In general

The Secretary may by regulations provide for increases in the amount of withholding otherwise required under this section in cases where the employee requests such changes.

(2)

Treatment as tax

Any increased withholding under paragraph (1) shall for all purposes be considered tax required to be deducted and withheld under this chapter.

(j)

Noncash remuneration to retail commission salesman

In the case of remuneration paid in any medium other than cash for services performed by an individual as a retail salesman for a person, where the service performed by such individual for such person is ordinarily performed for remuneration solely by way of cash commission an employer shall not be required to deduct or withhold any tax under this subchapter with respect to such remuneration, provided that such employer files with the Secretary such information with respect to such remuneration as the Secretary may by regulation prescribe.

(k)

Tips

In the case of tips which constitute wages, subsection (a) shall be applicable only to such tips as are included in a written statement furnished to the employer pursuant to section 6053(a), and only to the extent that the tax can be deducted and withheld by the employer, at or after the time such statement is so furnished and before the close of the calendar year in which such statement is furnished, from such wages of the employee (excluding tips, but including funds turned over by the employee to the employer for the purpose of such deduction and withholding) as are under the control of the employer; and an employer who is furnished by an employee a written statement of tips (received in a calendar month) pursuant to section 6053(a) to which paragraph (16)(B) of section 3401(a) is applicable may deduct and withhold the tax with respect to such tips from any wages of the employee (excluding tips) under his control, even though at the time such statement is furnished the total amount of the tips included in statements furnished to the employer as having been received by the employee in such calendar month in the course of his employment by such employer is less than $20. Such tax shall not at any time be deducted and withheld in an amount which exceeds the aggregate of such wages and funds (including funds turned over under section 3102(c)(2) or section 3202(c)(2)) minus any tax required by section 3102(a) or section 3202(a) to be collected from such wages and funds.

(l)

Determination and disclosure of marital status

(1)

Determination of status by employer

For purposes of applying the tables in subsections (a) and (c) to a payment of wages, the employer shall treat the employee as a single person unless there is in effect with respect to such payment of wages a withholding allowance certificate furnished to the employer by the employee after the date of the enactment of this subsection indicating that the employee is married.

(2)

Disclosure of status by employee

An employee shall be entitled to furnish the employer with a withholding allowance certificate indicating he is married only if, on the day of such furnishing, he is married (determined with the application of the rules in paragraph (3)). An employee whose marital status changes from married to single shall, at such time as the Secretary may by regulations prescribe, furnish the employer with a new withholding allowance certificate.

(3)

Determination of marital status

For purposes of paragraph (2), an employee shall on any day be considered—

(A)

as not married, if (i) he is legally separated from his spouse under a decree of divorce or separate maintenance, or (ii) either he or his spouse is, or on any preceding day within the calendar year was, a nonresident alien; or

(B)

as married, if (i) his spouse (other than a spouse referred to in subparagraph (A)) died within the portion of his taxable year which precedes such day, or (ii) his spouse died during one of the two taxable years immediately preceding the current taxable year and, on the basis of facts existing at the beginning of such day, the employee reasonably expects, at the close of his taxable year, to be a surviving spouse (as defined in section 2(a)).

(m)

Withholding allowances

Under regulations prescribed by the Secretary, an employee shall be entitled to an additional withholding allowance or additional reductions in withholding under this subsection. In determining the additional withholding allowance or the amount of additional reductions in withholding under this subsection, the employee may take into account (to the extent and in the manner provided by such regulations)—

(1)

estimated itemized deductions allowable under chapter 1 and the estimated deduction allowed under section 199A (other than the deductions referred to in section 151 and other than the deductions required to be taken into account in determining adjusted gross income under section 62(a)),

(2)

estimated tax credits allowable under chapter 1, and

(3)

such additional deductions (including the additional standard deduction under section 63(c)(3) for the aged and blind) and other items as may be specified by the Secretary in regulations.

(n)

Employees incurring no income tax liability

Notwithstanding any other provision of this section, an employer shall not be required to deduct and withhold any tax under this chapter upon a payment of wages to an employee if there is in effect with respect to such payment a withholding allowance certificate (in such form and containing such other information as the Secretary may prescribe) furnished to the employer by the employee certifying that the employee—

(1)

incurred no liability for income tax imposed under subtitle A for his preceding taxable year, and

(2)

anticipates that he will incur no liability for income tax imposed under subtitle A for his current taxable year.

The Secretary shall by regulations provide for the coordination of the provisions of this subsection with the provisions of subsection (f).

(o)

Extension of withholding to certain payments other than wages

(1)

General rule

For purposes of this chapter (and so much of subtitle F as relates to this chapter)—

(A)

any supplemental unemployment compensation benefit paid to an individual,

(B)

any payment of an annuity to an individual, if at the time the payment is made a request that such annuity be subject to withholding under this chapter is in effect, and

(C)

any payment to an individual of sick pay which does not constitute wages (determined without regard to this subsection), if at the time the payment is made a request that such sick pay be subject to withholding under this chapter is in effect,

shall be treated as if it were a payment of wages by an employer to an employee for a payroll period.

(2)

Definitions

(A)

Supplemental unemployment compensation benefits

For purposes of paragraph (1), the term “supplemental unemployment compensation benefits” means amounts which are paid to an employee, pursuant to a plan to which the employer is a party, because of an employee’s involuntary separation from employment (whether or not such separation is temporary), resulting directly from a reduction in force, the discontinuance of a plant or operation, or other similar conditions, but only to the extent such benefits are includible in the employee’s gross income.

(B)

Annuity

For purposes of this subsection, the term “annuity” means any amount paid to an individual as a pension or annuity.

(C)

Sick pay

For purposes of this subsection, the term “sick pay” means any amount which—

(i)

is paid to an employee pursuant to a plan to which the employer is a party, and

(ii)

constitutes remuneration or a payment in lieu of remuneration for any period during which the employee is temporarily absent from work on account of sickness or personal injuries.

(3)

Amount withheld from annuity payments or sick pay

If a payee makes a request that an annuity or any sick pay be subject to withholding under this chapter, the amount to be deducted and withheld under this chapter from any payment to which such request applies shall be an amount (not less than a minimum amount determined under regulations prescribed by the Secretary) specified by the payee in such request. The amount deducted and withheld with respect to a payment which is greater or less than a full payment shall bear the same relation to the specified amount as such payment bears to a full payment.

(4)

Request for withholding

A request that an annuity or any sick pay be subject to withholding under this chapter—

(A)

shall be made by the payee in writing to the person making the payments and shall contain the social security number of the payee,

(B)

shall specify the amount to be deducted and withheld from each full payment, and

(C)

shall take effect—

(i)

in the case of sick pay, with respect to payments made more than 7 days after the date on which such request is furnished to the payor, or

(ii)

in the case of an annuity, at such time (after the date on which such request is furnished to the payor) as the Secretary shall by regulations prescribe.

Such a request may be changed or terminated by furnishing to the person making the payments a written statement of change or termination which shall take effect in the same manner as provided in subparagraph (C). At the election of the payor, any such request (or statement of change or revocation) may take effect earlier than as provided in subparagraph (C).

(5)

Special rule for sick pay paid pursuant to certain collective-bargaining agreements

In the case of any sick pay paid pursuant to a collective-bargaining agreement between employee representatives and one or more employers which contains a provision specifying that this paragraph is to apply to sick pay paid pursuant to such agreement and contains a provision for determining the amount to be deducted and withheld from each payment of such sick pay—

(A)

the requirement of paragraph (1)(C) that a request for withholding be in effect shall not apply, and

(B)

except as provided in subsection (n), the amounts to be deducted and withheld under this chapter shall be determined in accordance with such agreement.

The preceding sentence shall not apply with respect to sick pay paid pursuant to any agreement to any individual unless the social security number of such individual is furnished to the payor and the payor is furnished with such information as is necessary to determine whether the payment is pursuant to the agreement and to determine the amount to be deducted and withheld.

(6)

Coordination with withholding on designated distributions under section 3405

This subsection shall not apply to any amount which is a designated distribution (within the meaning of section 3405(e)(1)).

(p)

Voluntary withholding agreements

(1)

Certain Federal payments

(A)

In general

If, at the time a specified Federal payment is made to any person, a request by such person is in effect that such payment be subject to withholding under this chapter, then for purposes of this chapter and so much of subtitle F as relates to this chapter, such payment shall be treated as if it were a payment of wages by an employer to an employee.

(B)

Amount withheld

¹The amount to be deducted and withheld under this chapter from any payment to which any request under subparagraph (A) applies shall be an amount equal to the percentage of such payment specified in such request. Such a request shall apply to any payment only if the percentage specified is 7 percent, any percentage applicable to any of the 3 lowest income brackets in the table under section 1(c), or such other percentage as is permitted under regulations prescribed by the Secretary.

(C)

Specified Federal payments

For purposes of this paragraph, the term “specified Federal payment” means—

(i)

any payment of a social security benefit (as defined in section 86(d)),

(ii)

¹ any payment referred to in the second sentence of section 451(d)  which is treated as insurance proceeds,

(iii)

any amount which is includible in gross income under section 77(a), and

(iv)

any other payment made pursuant to Federal law which is specified by the Secretary for purposes of this paragraph.

(D)

Requests for withholding

oRules similar to the rules that apply to annuities under subsection ()(4) shall apply to requests under this paragraph and paragraph (2).

(2)

Voluntary withholding on unemployment benefits

If, at the time a payment of unemployment compensation (as defined in section 85(b)) is made to any person, a request by such person is in effect that such payment be subject to withholding under this chapter, then for purposes of this chapter and so much of subtitle F as relates to this chapter, such payment shall be treated as if it were a payment of wages by an employer to an employee. The amount to be deducted and withheld under this chapter from any payment to which any request under this paragraph applies shall be an amount equal to 10 percent of such payment.

(3)

Authority for other voluntary withholding

The Secretary is authorized by regulations to provide for withholding—

(A)

from remuneration for services performed by an employee for the employee’s employer which (without regard to this paragraph) does not constitute wages, and

(B)

from any other type of payment with respect to which the Secretary finds that withholding would be appropriate under the provisions of this chapter,

if the employer and employee, or the person making and the person receiving such other type of payment, agree to such withholding. Such agreement shall be in such form and manner as the Secretary may by regulations prescribe. For purposes of this chapter (and so much of subtitle F as relates to this chapter), remuneration or other payments with respect to which such agreement is made shall be treated as if they were wages paid by an employer to an employee to the extent that such remuneration is paid or other payments are made during the period for which the agreement is in effect.

(q)

Extension of withholding to certain gambling winnings

(1)

General rule

¹Every person, including the Government of the United States, a State, or a political subdivision thereof, or any instrumentalities of the foregoing, making any payment of winnings which are subject to withholding shall deduct and withhold from such payment a tax in an amount equal to the product of the third lowest rate of tax applicable under section 1(c)  and such payment.

(2)

Exemption where tax otherwise withheld

In the case of any payment of winnings which are subject to withholding made to a nonresident alien individual or a foreign corporation, the tax imposed under paragraph (1) shall not apply to any such payment subject to tax under section 1441(a) (relating to withholding on nonresident aliens) or tax under section 1442(a) (relating to withholding on foreign corporations).

(3)

Winnings which are subject to withholding

For purposes of this subsection, the term “winnings which are subject to withholding” means proceeds from a wager determined in accordance with the following:

(A)

In general

Except as provided in subparagraphs (B) and (C), proceeds of more than $5,000 from a wagering transaction, if the amount of such proceeds is at least 300 times as large as the amount wagered.

(B)

State-conducted lotteries

Proceeds of more than $5,000 from a wager placed in a lottery conducted by an agency of a State acting under authority of State law, but only if such wager is placed with the State agency conducting such lottery, or with its authorized employees or agents.

(C)

Sweepstakes, wagering pools, certain parimutuel pools, jai alai, and lotteries

Proceeds of more than $5,000 from—

(i)

a wager placed in a sweepstakes, wagering pool, or lottery (other than a wager described in subparagraph (B)), or

(ii)

a wagering transaction in a parimutuel pool with respect to horse races, dog races, or jai alai if the amount of such proceeds is at least 300 times as large as the amount wagered.

(4)

Rules for determining proceeds from a wager

For purposes of this subsection—

(A)

proceeds from a wager shall be determined by reducing the amount received by the amount of the wager, and

(B)

proceeds which are not money shall be taken into account at their fair market value.

(5)

Exemption for bingo, keno, and slot machines

The tax imposed under paragraph (1) shall not apply to winnings from a slot machine, keno, and bingo.

(6)

Statement by recipient

Every person who is to receive a payment of winnings which are subject to withholding shall furnish the person making such payment a statement, made under the penalties of perjury, containing the name, address, and taxpayer identification number of the person receiving the payment and of each person entitled to any portion of such payment.

(7)

Coordination with other sections

For purposes of sections 3403 and 3404 and for purposes of so much of subtitle F (except section 7205) as relates to this chapter, payments to any person of winnings which are subject to withholding shall be treated as if they were wages paid by an employer to an employee.

(r)

Extension of withholding to certain taxable payments of Indian casino profits

(1)

In general

Every person, including an Indian tribe, making a payment to a member of an Indian tribe from the net revenues of any class II or class III gaming activity conducted or licensed by such tribe shall deduct and withhold from such payment a tax in an amount equal to such payment’s proportionate share of the annualized tax.

(2)

Exception

The tax imposed by paragraph (1) shall not apply to any payment to the extent that the payment, when annualized, does not exceed an amount equal to the sum of—

(A)

¹ the basic standard deduction (as defined in section 63(c)) for an individual to whom section 63(c)(2)(C)  applies, and

(B)

the exemption amount (as defined in section 151(d)).

(3)

Annualized tax

¹¹For purposes of paragraph (1), the term “annualized tax” means, with respect to any payment, the amount of tax which would be imposed by section 1(c)  (determined without regard to any rate of tax in excess of the fourth lowest rate of tax applicable under section 1(c)  ) on an amount of taxable income equal to the excess of—

(A)

the annualized amount of such payment, over

(B)

the amount determined under paragraph (2).

(4)

Classes of gaming activities, etc.

25 U.S.C. 2701For purposes of this subsection, terms used in paragraph (1) which are defined in section 4 of the Indian Gaming Regulatory Act ( et seq.), as in effect on the date of the enactment of this subsection, shall have the respective meanings given such terms by such section.

(5)

Annualization

Payments shall be placed on an annualized basis under regulations prescribed by the Secretary.

(6)

Alternate withholding procedures

At the election of an Indian tribe, the tax imposed by this subsection on any payment made by such tribe shall be determined in accordance with such tables or computational procedures as may be specified in regulations prescribed by the Secretary (in lieu of in accordance with paragraphs (2) and (3)).

(7)

Coordination with other sections

For purposes of this chapter and so much of subtitle F as relates to this chapter, payments to any person which are subject to withholding under this subsection shall be treated as if they were wages paid by an employer to an employee.

(s)

Exemption from withholding for any vehicle fringe benefit

(1)

Employer election not to withhold

The employer may elect not to deduct and withhold any tax under this chapter with respect to any vehicle fringe benefit provided to any employee if such employee is notified by the employer of such election (at such time and in such manner as the Secretary shall by regulations prescribe). The preceding sentence shall not apply to any vehicle fringe benefit unless the amount of such benefit is included by the employer on a statement timely furnished under section 6051.

(2)

Employer must furnish W–2

Any vehicle fringe benefit shall be treated as wages from which amounts are required to be deducted and withheld under this chapter for purposes of section 6051.

(3)

Vehicle fringe benefit

For purposes of this subsection, the term “vehicle fringe benefit” means any fringe benefit—

(A)

which constitutes wages (as defined in section 3401), and

(B)

which consists of providing a highway motor vehicle for the use of the employee.

(t)

Rate of withholding for certain stock

In the case of any qualified stock (as defined in section 83(i)(2)) with respect to which an election is made under section 83(i)—

(1)

the rate of tax under subsection (a) shall not be less than the maximum rate of tax in effect under section 1, and

(2)

such stock shall be treated for purposes of section 3501(b) in the same manner as a non-cash fringe benefit.

Aug. 16, 1954, ch. 736 68A Stat. 457 Aug. 9, 1955, ch. 666, § 2 69 Stat. 605 Pub. L. 87–256, § 110(g)(2)Sept. 21, 196175 Stat. 537 Pub. L. 88–272, title III, § 302(a)Feb. 26, 196478 Stat. 140 Pub. L. 89–97, title III, § 313(d)(3)July 30, 196579 Stat. 384 Pub. L. 89–212, § 2(c)Sept. 29, 196579 Stat. 859 Pub. L. 89–368, title I, § 101(a)Mar. 15, 196680 Stat. 38–61 Pub. L. 90–364, title I, § 102(c)June 28, 196882 Stat. 256 Pub. L. 91–36, § 2(a)June 30, 196983 Stat. 42 Pub. L. 91–53, § 6(a)Aug. 7, 196983 Stat. 96 Pub. L. 91–172, title VIII, § 805(a)Dec. 30, 196983 Stat. 686 Pub. L. 92–178, title II, § 208(a)Dec. 10, 197185 Stat. 512–517 Pub. L. 94–12, title IIMar. 29, 197589 Stat. 29 Pub. L. 94–164Dec. 23, 197589 Stat. 971 Pub. L. 94–331, § 3(a)(1)June 30, 197690 Stat. 782 Pub. L. 94–396, § 2(a)(1)Sept. 3, 197690 Stat. 1201 Pub. L. 94–414, § 3(a)(1)Sept. 17, 197690 Stat. 1273 Pub. L. 94–455, title IV, § 401(d)Oct. 4, 197690 Stat. 1557 Pub. L. 95–30, title I, § 105May 23, 197791 Stat. 140 Pub. L. 95–600, title INov. 6, 197892 Stat. 2770 Pub. L. 96–601, § 4(a)Dec. 24, 198094 Stat. 3496 Pub. L. 97–34, title I, § 101(e)Aug. 13, 198195 Stat. 184 Pub. L. 97–248, title IIISept. 3, 198296 Stat. 607 Pub. L. 98–67, title I, § 104(d)(3)Aug. 5, 198397 Stat. 380 Pub. L. 99–44, § 3May 24, 198599 Stat. 77 Pub. L. 99–514, title I, § 104(b)(15)Oct. 22, 1986100 Stat. 2106 Pub. L. 100–203, title X, § 10302(a)Dec. 22, 1987101 Stat. 1330–429 Pub. L. 100–647, title I, § 1003(a)(2)Nov. 10, 1988102 Stat. 3382 Pub. L. 101–508, title XI, § 11801(a)(41)Nov. 5, 1990104 Stat. 1388–521 Pub. L. 102–318, title V, § 522(b)(2)(D)July 3, 1992106 Stat. 314 Pub. L. 102–486, title XIXOct. 24, 1992106 Stat. 3031 Pub. L. 103–465, title VIIDec. 8, 1994108 Stat. 4995 Pub. L. 107–16, title I, § 101(c)(6)June 7, 2001115 Stat. 43 Pub. L. 109–222, title V, § 511(a)May 17, 2006120 Stat. 364 Pub. L. 112–56, title I, § 102(a)Nov. 21, 2011125 Stat. 712 Pub. L. 115–97, title IDec. 22, 2017131 Stat. 2070 Pub. L. 117–2, title IX, § 9611(b)(3)Mar. 11, 2021135 Stat. 149(, ; , ; , , ; , (b), , ; –(5), , ; , , ; –(e)(3), , ; , , ; , , ; , , ; –(e), (f)(1), (g), , , 704–708; , (b)(1), (c)–(h)(1), , ; , §§ 202(b), 205, , , 32; , §§ 2(b)(2), 5(a)(1), , , 975; , , ; , , ; , , ; , title V, §§ 502(b), 504(c)(3), title XII, § 1207(d), title XIX, §§ 1903(a)(17), 1906(b)(13)(A), , , 1559, 1566, 1705, 1810, 1834; , title IV, § 405(a), , , 156; , §§ 101(e), 102(c), title VI, § 601(b)(2), , , 2771, 2896; –(d), , , 3497; , , ; , §§ 317(a), 334(d), , , 627; , , ; , , ; , title XIII, §§ 1301(j)(8), 1303(b)(4), title XV, § 1581(b), , , 2658, 2766; , , ; , , ; , , ; , , ; , §§ 1934(a), 1942(a), , , 3036; , §§ 701(a), 702(a), , , 4996; –(9), , , 44; , , ; , , ; , §§ 11011(b)(4), 11041(c)(1), (2)(B)–(E), 11051(b)(2)(B), 13603(b)(2), , , 2082–2084, 2089, 2163; , , .)

Editorial Notes

References in Text

Pub. L. 89–809, title I, § 103(k)Nov. 13, 196680 Stat. 1554Paragraph (6) of section 3401(a), referred to in subsec. (f)(6), was struck out and a new paragraph (6) was added by , , .

lPub. L. 89–368Mar. 15, 1966The date of the enactment of this subsection, referred to in subsec. ()(1), is the date of enactment of , which was approved .

section 1(j)(2)(C) of this title section 1(j)(2)(F) of this titleSection 1(c), referred to in subsecs. (p)(1)(B), (q)(1), and (r)(3), to be treated, for purposes of the rate of tax, as a reference to the corresponding rate bracket under , with additional exception for reference in subsec. (q)(1), see .

Pub. L. 115–97, title I, § 13221(a)Dec. 22, 2017131 Stat. 2113Section 451(d), referred to in subsec. (p)(1)(C)(ii), was redesignated section 451(f) by , (b), , , 2115.

Pub. L. 107–147, title IV, § 411(e)(1)(C)Mar. 9, 2002116 Stat. 46Section 63(c)(2)(C), referred to in subsec. (r)(2)(A), was redesignated section 63(c)(2)(D), and a new section 63(c)(2)(C) was added, by , (D), , .

section 2703 of Title 25Section 4 of the Indian Gaming Regulatory Act, referred to in subsec. (r)(4), is classified to , Indians.

Pub. L. 103–465Dec. 8, 1994The date of the enactment of this subsection, referred to in subsec. (r)(4), is the date of enactment of , which was approved .

Amendments

Pub. L. 117–22021—Subsec. (f)(1)(C). substituted “section 24 (determined after application of subsection (j) thereof)” for “section 24(a)”.

Pub. L. 115–97, § 11041(c)(1)2017—Subsec. (a)(2). , substituted “means the amount by which the wages exceed the taxpayer’s withholding allowance, prorated to the payroll period.” for “means the amount by which the wages exceed the number of withholding exemptions claimed multiplied by the amount of one such exemption. The amount of each withholding exemption shall be equal to the amount of one personal exemption provided in section 151(b), prorated to the payroll period. The maximum number of withholding exemptions permitted shall be calculated in accordance with regulations prescribed by the Secretary under this section, taking into account any reduction in withholding to which an employee is entitled under this section.”

Pub. L. 115–97, § 11041(c)(2)(C)Subsec. (b)(1), (2). , substituted “allowance” for “exemption” in two places.

Pub. L. 115–97, § 11041(c)(2)(D)Subsec. (f). , substituted “allowance” for “exemptions” in heading.

Pub. L. 115–97, § 11041(c)(2)(B)Subsec. (f)(1), (2). , amended pars. (1) and (2) generally. Prior to amendment, pars. (1) and (2) related to allowed withholding exemptions and withholding exemption certificates, respectively.

Pub. L. 115–97, § 11041(c)(2)(C)Subsec. (f)(3) to (5). , substituted “allowance” for “exemption” wherever appearing.

Pub. L. 115–97, § 11041(c)(2)(C)Subsec. (f)(7). , which directed substitution of “allowance” for “exemption” in heading, was executed by substituting “Allowance” for “Exemption” to reflect the probable intent of Congress.

Pub. L. 115–97, § 11041(c)(2)(C), substituted “allowance” for “exemption” in two places.

Pub. L. 115–97, § 11041(c)(2)(C)Subsec. (g). , which directed amendment of par. (4) of subsec. (g) by substituting “allowance” for “exemption” wherever appearing, was executed to concluding provisions of subsec. (g) in two places to reflect the probable intent of Congress.

lPub. L. 115–97, § 11041(c)(2)(C)Subsec. ()(1), (2). , substituted “allowance” for “exemption” wherever appearing.

Pub. L. 115–97, § 11041(c)(2)(E)Subsec. (m). , substituted “an additional withholding allowance or additional reductions in withholding under this subsection. In determining the additional withholding allowance” for “additional withholding allowances or additional reductions in withholding under this subsection. In determining the number of additional withholding allowances”.

Pub. L. 115–97, § 11051(b)(2)(B)Subsec. (m)(1). , struck out “(other than paragraph (10) thereof)” after “section 62(a)”.

Pub. L. 115–97, § 11011(b)(4), inserted “and the estimated deduction allowed under section 199A” after “chapter 1”.

Pub. L. 115–97, § 11041(c)(2)(C)Subsec. (n). , substituted “allowance” for “exemption” in introductory provisions.

Pub. L. 115–97, § 13603(b)(2)Subsec. (t). , added subsec. (t).

Pub. L. 112–562011—Subsec. (t). struck out subsec. (t) which related to extension of 3 percent withholding to certain payments made by Government entities for property or services.

Pub. L. 109–2222006—Subsec. (t). added subsec. (t).

Pub. L. 107–16, § 101(c)(6)2001—Subsec. (p)(1)(B). , substituted “7 percent, any percentage applicable to any of the 3 lowest income brackets in the table under section 1(c),” for “7, 15, 28, or 31 percent”.

Pub. L. 107–16, § 101(c)(7)Subsec. (p)(2). , substituted “10 percent” for “15 percent”.

Pub. L. 107–16, § 101(c)(8)Subsec. (q)(1). , substituted “equal to the product of the third lowest rate of tax applicable under section 1(c) and such payment” for “equal to 28 percent of such payment”.

Pub. L. 107–16, § 101(c)(9)Subsec. (r)(3). , substituted “the fourth lowest rate of tax applicable under section 1(c)” for “31 percent” in introductory provisions.

Pub. L. 103–465, § 702(a)1994—Subsec. (p). , reenacted heading without change and amended text of subsec. (p) generally. Prior to amendment, text read as follows: “The Secretary is authorized by regulations to provide for withholding—

“(1) from remuneration for services performed by an employee for his employer which (without regard to this subsection) does not constitute wages, and

“(2) from any other type of payment with respect to which the Secretary finds that withholding would be appropriate under the provisions of this chapter,

if the employer and the employee, or in the case of any other type of payment the person making and the person receiving the payment, agree to such withholding. Such agreement shall be made in such form and manner as the Secretary may by regulations provide. For purposes of this chapter (and so much of subtitle F as relates to this chapter) remuneration or other payments with respect to which such agreement is made shall be treated as if they were wages paid by an employer to an employee to the extent that such remuneration is paid or other payments are made during the period for which the agreement is in effect.”

Pub. L. 103–465, § 701(a)Subsec. (r). , added subsec. (r).

oPub. L. 102–3181992—Subsec. ()(6). substituted “3405(e)(1)” for “3405(d)(1)”.

Pub. L. 102–486, § 1934(a)Subsec. (q)(1). , substituted “28 percent” for “20 percent”.

Pub. L. 102–486, § 1942(a)Subsec. (q)(3)(A), (C). , substituted “$5,000” for “$1,000”.

Pub. L. 101–5081990—Subsec. (a)(3). struck out par. (3) which read as follows: “Notwithstanding the provisions of this subsection, the Secretary shall modify the tables and procedures under paragraph (1) to reflect—

October 1, 1981“(A) the amendments made by section 101(b) of the Economic Recovery Tax Act of 1981, and such modification shall take effect on , as if such amendments made a 5-percent reduction effective on such date, and

“(B) the amendments made by section 101(a) of such Act, and such modifications shall take effect—

July 1, 1982“(i) on , as if the reductions in the rate of tax under section 1 (as amended by such section) were attributable to a 10-percent reduction effective on such date, and

July 1, 1983“(ii) on , as if such reductions were attributable to a 10-percent reduction effective on such date.”

Pub. L. 100–6471988—Subsec. (m)(1). substituted “section 62(a) (other than paragraph (10) thereof))” for “section 62) (other than paragraph (13) thereof)”.

Pub. L. 100–2031987—Subsec. (f)(3)(B). amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “A withholding exemption certificate furnished the employer in cases in which a previous such certificate is in effect shall take effect with respect to the first payment of wages made on or after the first status determination date which occurs at least 30 days from the date on which such certificate is so furnished, except that at the election of the employer such certificate may be made effective with respect to any payment of wages made on or after the date on which such certificate is so furnished; but a certificate furnished pursuant to paragraph (2)(C) shall not take effect, and may not be made effective, with respect to any payment of wages made in the calendar year in which the certificate is furnished. For purposes of this subparagraph the term ‘status determination date’ means January 1, May 1, July 1, and October 1 of each year.”

Pub. L. 99–514, § 104(b)(15)(F)1986—Subsec. (f)(1). , substituted “standard deduction” for “zero bracket” and “subparagraph (E)” for “subparagraph (G)” in last sentence.

Pub. L. 99–514, § 104(b)(15)(B)Subsec. (f)(1)(A). , inserted “unless he is an individual described in section 151(d)(2)” after “himself”.

Pub. L. 99–514, § 104(b)(15)(A)Subsec. (f)(1)(B). , redesignated subpar. (D) as (B) and struck out former subpar. (B) which read as follows: “one additional exemption for himself if, on the basis of facts existing at the beginning of such day, there may reasonably be expected to be allowable an exemption under section 151(c)(1) (relating to old age) for the taxable year under subtitle A in respect of which amounts deducted and withheld under this chapter in the calendar year in which such day falls are allowed as a credit;”.

Pub. L. 99–514, § 104(b)(15)(C), which directed that “subparagraph (A) or (D)” be substituted for “subparagraph (A), (B), (C), or (F)” was executed by making the substitution for “subparagraph (A), (B), or (C)”, as the probable intent of Congress.

Pub. L. 99–514, § 104(b)(15)(A)Subsec. (f)(1)(C). , (D), redesignated subpar. (E) as (C), substituted “section 151(c)” for “section 151(e)”, and struck out former subpar. (C) which read as follows: “one additional exemption for himself if, on the basis of facts existing at the beginning of such day, there may reasonably be expected to be allowable an exemption under section 151(d)(1) (relating to the blind) for the taxable year under subtitle A in respect of which amounts deducted and withheld under this chapter in the calendar year in which such day falls are allowed as a credit;”.

Pub. L. 99–514, § 104(b)(15)(A)Subsec. (f)(1)(D). , redesignated subpar. (F) as (D). Former subpar. (D) redesignated (B).

Pub. L. 99–514, § 104(b)(15)(A)Subsec. (f)(1)(E). , (E), redesignated subpar. (G) as (E) and substituted “standard deduction” for “zero bracket”. Former subpar. (E) redesignated (C).

Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”.

Pub. L. 99–514, § 104(b)(15)(A)Subsec. (f)(1)(F), (G). , redesignated subpars. (F) and (G) as (D) and (E), respectively.

Pub. L. 99–514, § 1581(b)Subsec. (i)(1). , struck out “or decreases” after “increases”.

Pub. L. 99–514, § 104(b)(15)(G)Subsec. (m)(3). , inserted “(including the additional standard deduction under section 63(c)(3) for the aged and blind)”.

Pub. L. 99–514, § 1303(b)(4)Subsec. (r). , struck out subsec. (r) which provided for extension of withholding to GSOC distributions.

Pub. L. 99–441985—Subsec. (s). added subsec. (s).

Pub. L. 98–67 section 3406 of this title1983—Subsec. (s). struck out subsec. (s) which related to extension of withholding to certain payments where identifying number was not furnished or was inaccurate. See .

oPub. L. 97–248, § 334(d)1982—Subsec. ()(6). , added par. (6).

Pub. L. 97–248, § 317(a)Subsec. (s). , added subsec. (s).

Pub. L. 97–34, § 101(e)(1)Oct. 1, 1981July 1, 1982July 1, 19831981—Subsec. (a). , revised subsec. (a) generally to provide for a 5-percent reduction in income tax withholding rates on , a further 10-percent reduction on , and a final 10-percent reduction on .

Pub. L. 97–34, § 101(e)(2)(A)Subsec. (b)(1). , redesignated par. (2) as (1). Former par. (1), which set out a table for determining amount of one withholding exemption for each of the various payroll periods, was struck out.

Pub. L. 97–34, § 101(e)(2)(A)Subsec. (b)(2). , redesignated par. (3) as (2). Former par. (2) redesignated (1).

Pub. L. 97–34, § 101(e)(2)(A)Subsec. (b)(3). , (B), redesignated par. (4) as (3) and substituted provisions relating to an employer’s computation of the tax to be deducted and withheld as if the aggregate of the wages paid to the employee during the calendar week were paid for a weekly payroll period, for provisions relating to an employer’s computation of the tax to be deducted and withheld using the excess of the aggregate of the wages paid to the employee during the calendar week over the withholding exemption allowed by this subsection for a weekly payroll period. Former par. (3) redesignated (2).

Pub. L. 97–34, § 101(e)(2)(A)Subsec. (b)(4), (5). , redesignated par. (5) as (4). Former par. (4) redesignated (3).

Pub. L. 97–34, § 101(e)(3)Subsec. (f)(1)(G). , inserted “(or more than one exemption if so prescribed by the Secretary)” after “an amount equal to one exemption”.

Pub. L. 97–34, § 101(e)(4)Subsec. (i). , substituted provisions authorizing the Secretary by regulations to provide for increases or decreases in the amount of withholding otherwise required under this section in cases where the employee requests the changes, for provisions under which the Secretary was authorized to provide withholding in addition to that otherwise required under this section in cases in which the employer and the employee agreed to such additional withholding.

Pub. L. 97–34, § 101(e)(5)Subsec. (m). , revised provisions respecting additional withholding allowances for anticipated excess itemized deductions and tax credits claimed in accordance with Treasury regulations and Treasury statutory authority to provide additional withholding allowances for any additional items specified in Treasury regulations.

oPub. L. 96–601, § 4(a)1980—Subsec. ()(1)(C). , added subpar. (C).

oPub. L. 96–601, § 4(d)Subsec. ()(2)(B). , struck out “, but only to the extent that the amount is includible in the gross income of such individual” after “pension or annuity”.

oPub. L. 96–601, § 4(c)Subsec. ()(2)(C). , added subpar. (C).

oPub. L. 96–601, § 4(b)oSubsec. ()(3). , substituted provision authorizing amount to be withheld from annuity payments or sick pay for provision relating to request for withholding. See subsec. ()(4) of this section.

oPub. L. 96–601, § 4(b)Subsec. ()(4), (5). , added pars. (4) and (5).

Pub. L. 95–600, § 101(e)(1)December 31, 1978January 1, 1975May 31, 1977January 1, 1979January 1, 1976December 31, 1978January 1, 19751978—Subsec. (a). , substituted “With respect to wages paid after , the tables so prescribed shall be the same as the tables prescribed under this subsection which were in effect on , except that such tables shall be modified to the extent necessary to reflect the amendments made by sections 101 and 102 of the Tax Reduction and Simplification Act of 1977 and the amendments made by section 101 of the Revenue Act of 1978.” for “With respect to wages paid after , and before , the tables so prescribed shall be the same as the tables prescribed under this subsection which were in effect on ; except that such tables shall be modified to the extent necessary so that, had they been in effect for all of 1977, they would reflect the full year effect of the amendments made by sections 101 and 102 of the Tax Reduction and Simplification Act of 1977. With respect to wages paid after , the tables so prescribed shall be the same as the tables prescribed under this subsection which were in effect on , except that such tables shall be modified to the extent necessary to reflect the amendments made by sections 101 and 102 of the Tax Reduction and Simplification Act of 1977.”

Pub. L. 95–600, § 102(c)(1)Subsec. (b)(1). , increased the amounts set out in the table for one withholding exemption for each of the payroll period categories from $14.40, $28.80, $31.30, $62.50, $187.50, $375.00, $750.00 and $2.10 to $19.23, $38.46, $41.66, $83.33, $250.00, $500.00, $1,000.00 and $2.74, respectively.

Pub. L. 95–600Subsec. (m)(1). , §§ 101(e)(2), 102(c)(2), substituted “$1,000” for “$750”, “$3,400” for “$3,200” and “$2,300” for “$2,200”.

Pub. L. 95–600, § 601(b)(2)Subsec. (r). , added subsec. (r).

Pub. L. 95–30, § 105(a)May 31, 1977January 1, 1979January 1, 1976December 31, 1978January 1, 1975January 1, 1978January 1, 1976December 31, 1977January 1, 19751977—Subsec. (a). , substituted “With respect to wages paid after , and before , the tables so prescribed shall be the same as the tables prescribed under this subsection which were in effect on ; except that such tables shall be modified to the extent necessary so that, had they been in effect for all of 1977, they would reflect the full year effect of the amendments made by sections 101 and 102 of the Tax Reduction and Simplification Act of 1977. With respect to wages paid after , the tables so prescribed shall be the same as the tables prescribed under this subsection which were in effect on , except that such tables shall be modified to the extent necessary to reflect the amendments made by sections 101 and 102 of the Tax Reduction and Simplification Act of 1977” for “With respect to wages paid prior to , the tables so prescribed shall be the same as the tables prescribed under this section which were in effect on . With respect to wages paid after , the Secretary shall prescribe new tables which shall be the same as the tables prescribed under this subsection which were in effect on , except that such tables shall be modified to the extent necessary to reflect the amendments made to subsections (b) and (c) of section 141 by the Tax Reform Act of 1976”.

Pub. L. 95–30, § 105(b)(1)Subsec. (f)(1). , substituted “zero bracket” for “standard deduction” in subpar. (G) and in provisions following subpar. (G).

Pub. L. 95–30, § 105(b)(2)Subsec. (m)(1)(B). , substituted “an amount equal to $3,200 ($2,200” for “an amount equal to the lesser of (i) 16 percent of his estimated wages, or (ii) $2,800 ($2,400”.

Pub. L. 95–30, § 105(b)(3)(A)Subsec. (m)(2)(A). , (B), substituted “section 151” for “sections 141 and 151” and “(or the zero bracket amount (within the meaning of section 63(d)))” for “(or the amount of the standard deduction)”.

Pub. L. 95–30, § 105(b)(3)(C)Subsec. (m)(2)(C). , substituted “(or the zero bracket amount)” for “(or the standard deduction)”.

Pub. L. 95–30, § 405(a)Subsec. (q)(3)(C). , inserted reference to certain parimutuel pools and jai alai in heading and, in text, designated existing provisions as cl. (i) and added cl. (ii).

Pub. L. 94–455January 1, 1978December 31, 1977January 1, 1975April 30, 1975January 1, 1976January 1, 19761976—Subsec. (a). , §§ 401(d)(1), 1906 (b)(13)(A), struck out “or his delegate” after “Secretary”, inserted “With respect to wages paid prior to ” after “by the Secretary”, as amended, and substituted “prescribed under this section which were” for “contained in this subsection as” after “same as the tables”, “1976” for “1975” after “January 1”, and “With respect to wages paid after , the Secretary shall prescribe new tables which shall be the same as the tables prescribed under this subsection which were in effect on , except that such tables shall be modified to the extent necessary to reflect the amendments made to subsections (b) and (c) of section 141 by the Tax Reform Act of 1976” for “except that the amounts set forth as amounts of income tax to be withheld with respect to wages paid after , and before , shall reflect the full calendar year effect for 1975 of the amendments made by sections 201, 202, 203, and 204 of the Tax Reduction Act of 1975” after “effect on ”, as amended.

Pub. L. 94–414October 1, 1976September 15, 1976 substituted “” for “”.

Pub. L. 94–396September 15, 1976September 1, 1976 substituted “” for “”.

Pub. L. 94–331September 1, 1976July 1, 1976 substituted “” for “”.

Pub. L. 94–455, § 1906(b)(13)(A)Subsec. (c)(4). , struck out “or his delegate” after “Secretary”.

Pub. L. 94–455 Pub. L. 94–12Mar. 29, 1975Subsec. (c)(6). , §§ 401(d)(2), 1906(b)(13)(A), substituted “the table for an annual payroll period prescribed pursuant to subsection (a)” for “table 7 contained in subsection (a)” after “basis of the”, as subsec. (c)(6) was in effect on the day before the date of enactment of the Tax Reduction Act of 1975, , which was approved on , and struck out “or his delegate” after “Secretary”.

Pub. L. 94–455, § 1906(b)(13)(A)Subsecs. (f), (h), (i), (j). , struck out “or his delegate” after “Secretary”.

lPub. L. 94–455, § 1903(a)(17)Subsec. (). , substituted “section 2(a)” for “section 2(b)” after “as defined in”.

Pub. L. 94–455, § 401(d)(3)Subsec. (m)(1)(B). , reenacted subpar. (B) without change.

Pub. L. 94–455, § 502(b)Subsec. (m)(2)(A). , inserted “(other than paragraph (13) thereof)” after “under section 62”.

Pub. L. 94–455, § 1906(b)(13)(A)Subsec. (m)(2)(D), (3)(B). , struck out “or his delegate” after “Secretary”.

Pub. L. 94–455, § 504(c)(3)Subsec. (m)(4). , added subpar. (C). § 1906(b)(13)(A) struck out “or his delegate” after “Secretary”.

Pub. L. 94–455, § 1906(b)(13)(A)Subsecs. (n), (p). , struck out “or his delegate” after “Secretary” wherever appearing.

Pub. L. 94–455, § 1207(d)Subsec. (q). , added subsec. (q).

Pub. L. 94–164, § 5(a)(1)Dec. 31, 1975July 1, 1976Dec. 10, 19751975—Subsec. (a). , inserted provision that the tables prescribed with respect to wages paid after , and before , shall be the same as the tables prescribed under this subsection which were in effect on .

Pub. L. 94–12, § 205(a)May 1, 1975Dec. 31, 1975Pub. L. 94–12, substituted provisions directing the Secretary to prescribe new withholding tables setting changed withholding rates for wages paid during the period , to , so as to reflect the full calendar year effect for 1975 of the amendments to the minimum standard deduction, the percentage standard deduction, the earned income credit, and the additional tax credit by sections 201, 202, 203, and 204 of the Tax Reduction Act of 1975, , for provisions setting out 8 tables to be followed by employers in withholding taxes on wages paid.

Pub. L. 94–12, § 205(b)Subsec. (c)(6). , substituted “the table for an annual payroll period prescribed pursuant to subsection (a)” for “table 7 contained in subsection (a)”. See 1976 Amendment note set out above.

Pub. L. 94–164, § 2(b)(2)Subsec. (m)(1)(B). , substituted “$2,800” and “$2,400” for “$2,600” and “$2,300” respectively in cl. (ii).

Pub. L. 94–12, § 202(b), substituted “the lesser of (i) 16 percent of his estimated wages, or (ii) $2,600 ($2,300 in the case of an individual who is not married (within the meaning of section 143) and who is not a surviving spouse (as defined in section 2(a)))” for “the lesser of (i) $2,000 or (ii) 15 percent of his estimated wages”.

Pub. L. 92–178, § 208(a)Jan. 15, 1972Dec. 31, 1969July 1, 1970June 30, 1970Jan. 1, 1971Dec. 31, 1970Jan. 1, 1972Dec. 31, 1971Jan. 1, 1973Dec. 31, 1972Pub. L. 92–178, § 208(h)(1)Dec. 31, 1971Jan. 16, 19721971—Subsec. (a). , substituted new sets of tables 1 to 8 applicable (under § 208(i)(1)) with respect to wages paid after , for the tables applicable in the case of wages paid as provided in former: par. (1) after , and before ; par. (2) after , and before ; par. (3) after , and before ; par. (4) after , and before ; and par. (5) after . , made provisions of par. (3) applicable (under section 208(i)(2)) with respect to wages paid after , and before .

Pub. L. 92–178, § 208(b)(1)Jan. 15, 1972Pub. L. 92–178, § 208(h)(2)Pub. L. 91–172, § 805(b)(1)June 30, 1970Jan. 16, 1972Jan. 1, 1972Subsec. (b)(1). , revised withholding rates upwards, substituting 14.40; 28.80; 31.30; 62.50; 187.50; 375.00; 750.00; and 2.10 for 12.50; 25.00 27.10; 54.20; 162.50; 325.00; 650.00; and 1.80, respectively, to be effective with respect to wages paid after . , in amending , extended application of such former withholding rates to wages paid after , and before , previously applicable to wages paid before .

Pub. L. 92–178, § 208(g)Subsec. (c)(6). , substituted “table 7 contained in subsection (a)” for “table 7 contained in paragraph (1), (2), (3), (4), or (5) (whichever is applicable) of subsection (a)”.

Pub. L. 92–178, § 208(c)Subsec. (f)(1)(G). , added subpar. (G).

Pub. L. 92–178, § 208(d)Subsec. (f)(7). , added par. (7).

Pub. L. 92–178, § 208(e)Subsec. (m)(1)(B). , substituted “an amount equal to the lesser of (i) $2,000 or (ii) 15 percent of his estimated wages” for “an amount equal to 15 percent of his estimated wages”.

Pub. L. 92–178, § 208(f)(1)Subsec. (m)(2)(A). , inserted “or (if such a return has not been filed for such preceding taxable year at the time the withholding exemption certificate is furnished the employer) the second taxable year preceding the estimation year” after “for the taxable year preceding the estimation year”.

Pub. L. 92–178, § 208(f)(2)Subsec. (m)(2)(D). , substituted as definition of “estimation year” the calendar year in which the wages are paid for prior provision defining term as meaning “(i) with respect to payments of wages after April 30 and on or before December 31 of any calendar year, such calendar year, and (ii) with respect to payments of wages on or after January 1 and before May 1 of any calendar year, the preceding calendar year (except that with respect to an exemption certificate furnished by an employee after he has filed his return for the preceding calendar year, such term means the current calendar year).”

Pub. L. 92–178, § 208(f)(3)Subsec. (m)(3)(B) to (E). , struck out subpars. (B) and (C) providing that only one certificate be in effect and for termination of effectiveness of certificate and redesignated subpars. (D) and (E) as (B) and (C), respectively.

Pub. L. 91–172, § 805(a)Dec. 31, 1969July 1, 1970June 30, 1970January 1, 1972July 13, 1968Dec. 31, 19691969—Subsec. (a)(1). , (b)(2), substituted new sets of tables 1 to 8 for application to wages paid after , and before , and after , and before , for the tables applicable to wages paid before , and after .

Pub. L. 91–53, § 6(a)(1)December 31, 1969July 31, 1969, substituted “” for “”.

Pub. L. 91–36, § 2(a)(1)July 31, 1969June 30, 1969, substituted “” for “”.

Pub. L. 91–172, § 805(a)June 30, 1970Jan. 1, 1971June 30, 1970Jan. 1, 1970Subsec. (a)(2). , substituted a set of tables 1 to 8 for application to wages paid after , and before , for the tables applicable to wages paid after , and before .

Pub. L. 91–53, § 6(a)(2)January 1, 1970August 1, 1969, substituted “” for “”.

Pub. L. 91–36, § 2(a)(2)August 1, 1969July 1, 1969, substituted “” for “”.

Pub. L. 91–172, § 805(a)Dec. 31, 1970Jan. 1, 1972Dec. 31, 1971Jan. 1, 1973Dec. 31, 1972Subsec. (a)(3) to (5). , added sets of tables applicable, respectively, to wages paid after , and before , after , and before , and after .

Pub. L. 91–172, § 805(b)(1)Dec. 31, 1969July 1, 1970June 30, 1970Jan. 1, 1972Subsec. (b)(1). –(4), revised withholding rates effective with respect to wages paid after , and before , for the period after , and before , during 1972, and after 1972.

Pub. L. 91–172, § 805(c)(1)Subsec. (c)(1). , substituted provisions authorizing employer to deduct and withhold tax determinable according to tables prescribed by the Secretary or his delegate for provisions under which the employer was authorized to deduct and withhold tax only according to tables set out.

Pub. L. 91–172, § 805(c)(2)Dec. 31, 1969July 13, 1968Jan. 1, 1970Subsec. (c)(6). , substituted provisions for determination of amount deductible according to tables prescribed by the Secretary or his delegate and for computation of wages and amounts of income tax after , for provisions for determination of such wages and amounts of income tax after , and before .

Pub. L. 91–53, § 6(a)(3)January 1, 1970August 1, 1969, substituted “” for “”.

Pub. L. 91–36, § 2(a)(3)August 1, 1969July 1, 1969, substituted “” for “”.

Pub. L. 91–172, § 805(d)Subsec. (h). , redesignated existing pars. (1) to (3) as subpars. (A) to (C) of par. (1), and added pars. (2) to (4).

Pub. L. 91–172, § 805(e)(2)Subsec. (m)(1). , substituted $750 for $700 in the material preceding subpar. (A) and in subpar. (B) substituted 15 per cent for 10 per cent of the first $7,500 and 17 per cent of remainder of the estimated wages.

Pub. L. 91–172, § 805(e)(2)Subsec. (m)(2)(A). , inserted amount of standard deduction as an alternative limit in cl. (i), and substituted the determinable additional deductions for provisions referring to an employee who did not show such deductions on his return.

Pub. L. 91–172, § 805(e)(2)Subsec. (m)(2)(B). , struck out limit on aggregate amount.

Pub. L. 91–172, § 805(e)(1)Subsec. (m)(2)(C), (D). , (2), added subpar. (C). Former subpar. (C) redesignated (D)

Pub. L. 91–172, § 805(f)(1)Subsec. (n). , added subsec. (n).

oPub. L. 91–172, § 805(g)oSubsecs. (), (p). , added subsecs. () and (p).

Pub. L. 90–364, § 102(c)(1)June 30, 19691968—Subsec. (a). , designated existing Tables 1 to 8 as constituting par. (1), inserted provisions preceding existing Table 1–8 so as to limit their application to the case of wages paid on or before the 15th day after the date of the enactment of the Revenue and Expenditure Control Act of 1968 or after , and added par. (2).

Pub. L. 90–364, § 102(c)(2)Subsec. (c)(6). , added par. (6).

Pub. L. 89–368, § 101(a)1966—Subsec. (a). , struck out reference to subsections (j) and (k) and substituted provisions establishing separate tables for single persons and for married persons in each of eight payroll period categories each containing six graduated withholding rates ranging from 14 to 30 percent for provisions placing the rate at a fixed 14 percent.

Pub. L. 89–368, § 101(b)Subsec. (b)(1). , increased amounts set out for one withholding exemption for each of the payroll period categories from “$13.00”, “$26.00”, “$28.00”, “$56.00”, “$167.00”, “$333.00”, “$667.00”, and “$1.80” to “$13.50”, “$26.90”, “$29.20”, “$58.30”, “$175.00”, “$350.00”, “$700.00”, and “$1.90” respectively.

Pub. L. 89–368, § 101(c)Subsec. (c)(1). , replaced existing tables with separate tables for employees who are married and for employees who are not married covering weekly, biweekly, semimonthly, monthly, and daily or miscellaneous pay periods and reflecting increased and graduated withholding rates.

Pub. L. 89–368, § 101(e)(1)Subsec. (f)(1)(F), (3)(B). , (3), added par. (1)(F) and, in par. (3)(B), changed definition of “status determination date” from January 1 and July 1 of each year to January 1, May 1, July 1, and October 1 of each year.

lPub. L. 89–368, § 101(d)lSubsec. (). , added subsec. ().

Pub. L. 89–368, § 101(e)(2)Subsec. (m). , added subsec. (m).

Pub. L. 89–97, § 313(d)(3)1965—Subsec. (a). , substituted “subsections (j) and (k)” for “subsection (j)”.

Pub. L. 89–97, § 313(d)(4)Subsec. (h)(3). , inserted “(and, in the case of tips referred to in subsection (k), within 30 days thereafter)” after “quarter” first place it appears.

Pub. L. 89–212Subsec. (k). inserted “or section 3202 (c)(2)” and “or section 3202(a)”.

Pub. L. 89–97, § 313(d)(5), added subsec. (k).

Pub. L. 88–272, § 302(a)1964—Subsec. (a). , reduced tax from 18% to 14%.

Pub. L. 88–272, § 302(b)Subsec. (c)(1). , substituted new tables reflecting lowered withholding rates.

Pub. L. 87–2561961—Subsec. (f)(6). added par. (6).

Aug. 9, 19551955—Subsec. (a). Act , § 2(a), inserted “(except as provided in subsection (j))” after “upon such wages”.

Aug. 9, 1955Subsec. (j). Act , § 2(b), added subsec. (j).

Statutory Notes and Related Subsidiaries

Effective Date of 2021 Amendment

Pub. L. 117–2Dec. 31, 2020section 9611(c)(1) of Pub. L. 117–2 section 24 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .

Effective Date of 2017 Amendment

section 11011(b)(4) of Pub. L. 115–97Dec. 31, 2017section 11011(e) of Pub. L. 115–97 section 62 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .

Pub. L. 115–97Dec. 31, 2017Jan. 1, 2019Pub. L. 115–97 section 11041(f) of Pub. L. 115–97 section 151 of this titleAmendment by section 11041(c)(1), (2)(B)–(E) of applicable to taxable years beginning after , with allowance for Secretary of the Treasury to administer this section for taxable years beginning before , without regard to the amendments made by subsecs. (a) and (c) of , see , set out as a note under .

section 11051(b)(2)(B) of Pub. L. 115–97 section 71(b)(2) of this titleDec. 22, 2017Dec. 31, 2018Dec. 31, 2018Dec. 31, 2018section 11051 of Pub. L. 115–97 section 11051(c) of Pub. L. 115–97 section 61 of this titleAmendment by applicable to any divorce or separation instrument (as defined in former as in effect before ) executed after , and to such instruments executed on or before , and modified after , if the modification expressly provides that the amendment made by applies to such modification, see , set out as a note under .

section 13603(b)(2) of Pub. L. 115–97Dec. 31, 2017section 13603(f)(1) of Pub. L. 115–97 section 83 of this titleAmendment by applicable to stock attributable to options exercised, or restricted stock units settled, after , see , set out as a note under .

Effective Date of 2011 Amendment

Pub. L. 112–56, title I, § 102(b)Nov. 21, 2011125 Stat. 712

December 31, 2011“The amendment made by this section [amending this section] shall apply to payments made after .”

, , , provided that:

Effective Date of 2006 Amendment

Pub. L. 109–222, title V, § 511(b)May 17, 2006120 Stat. 365 Pub. L. 111–5, div. B, title I, § 1511Feb. 17, 2009123 Stat. 355

December 31, 2011“The amendment made by this section [amending this section] shall apply to payments made after .”

, , , as amended by , , , provided that:

Effective Date of 2001 Amendment

Pub. L. 107–16June 7, 2001section 1(i)(1)(D) of this title section 101(d)(2) of Pub. L. 107–16 section 1 of this titleAmendment by applicable to amounts paid after the 60th day after , and references to income brackets and rates of tax in such amendment to be applied without regard to , see , set out as an Effective and Termination Dates of 2001 Amendment note under .

Effective Date of 1994 Amendment

Pub. L. 103–465, title VII, § 701(b)Dec. 8, 1994108 Stat. 4996

December 31, 1994“The amendment made by this section [amending this section] shall apply to payments made after .”

, , , provided that:

section 702(a) of Pub. L. 103–465Dec. 31, 1996section 702(d) of Pub. L. 103–465 section 3304 of this titleAmendment by applicable to payments made after , see , set out as a note under .

Effective Date of 1992 Amendments

Pub. L. 102–486, title XIX, § 1934(b)Oct. 24, 1992106 Stat. 3032

December 31, 1992“The amendment made by this section [amending this section] applies to payments received after .”

, , , provided that:

Pub. L. 102–486, title XIX, § 1942(b)Oct. 24, 1992106 Stat. 3036

December 31, 1992“The amendments made by subsection (a) [amending this section] shall apply to payments of winnings after .”

, , , provided that:

Pub. L. 102–318Dec. 31, 1992section 522(d) of Pub. L. 102–318 section 401 of this titleAmendment by applicable, except as otherwise provided, to distributions after , see , set out as a note under .

Effective Date of 1988 Amendment

Pub. L. 100–647 Pub. L. 99–514 section 1019(a) of Pub. L. 100–647 section 1 of this titleAmendment by effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, , to which such amendment relates, see , set out as a note under .

Effective Date of 1987 Amendment

Pub. L. 100–203, title X, § 10302(b)Dec. 22, 1987101 Stat. 1330–429

Dec. 22, 1987“The amendment made by subsection (a) [amending this section] shall apply to certificates furnished after the day 30 days after the date of the enactment of this Act [].”

, , , provided that:

Effective Date of 1986 Amendment

section 104(b)(15) of Pub. L. 99–514Dec. 31, 1986section 151(a) of Pub. L. 99–514 section 1 of this titleAmendment by applicable to taxable years beginning after , see , set out as a note under .

section 1301(j)(8) of Pub. L. 99–514Aug. 15, 1986Pub. L. 99–514 section 141 of this titleAmendment by applicable to bonds issued after , except as otherwise provided, see sections 1311 to 1318 of , set out as an Effective Date; Transitional Rules note under .

section 1303(b)(4) of Pub. L. 99–514Oct. 22, 1986section 1311(f) of Pub. L. 99–514 section 141 of this titleAmendment by effective , see , as amended, set out as an Effective Date; Transitional Rules note under .

Effective Date of 1985 Amendment

Pub. L. 99–44, § 6(d)May 24, 198599 Stat. 79

January 1, 1985“The amendment made by section 3 [amending this section] shall take effect on .”

, , , provided that:

Effective Date of 1983 Amendment

Pub. L. 98–67Dec. 31, 1983section 110(a) of Pub. L. 98–67 section 31 of this titleAmendment by applicable with respect to payments made after , see , set out as a note under .

Effective Date of 1982 Amendment

Pub. L. 97–248, title III, § 317(b)Sept. 3, 198296 Stat. 610

December 31, 1983“The amendments made by subsection (a) [amending this section] shall apply to payments made after .”

, , , provided that:

section 334(d) of Pub. L. 97–248Dec. 31, 1982section 334(e) of Pub. L. 97–248 section 3405 of this titleAmendment by applicable to payments or other distributions made after , see , set out as an Effective Date note under .

Effective Date of 1981 Amendment

Pub. L. 97–34, title I, § 101(f)(2)Aug. 13, 198195 Stat. 185

September 30, 1981December 31, 1981“The amendments made by subsection (e) [amending this section] shall apply to remuneration paid after ; except that the amendment made by subsection (e)(5) [amending this section] shall apply to remuneration paid after .”

, , , provided that:

Effective Date of 1980 Amendment

Pub. L. 96–601, § 4(f)Dec. 24, 198094 Stat. 3498

section 6051 of this titleDec. 24, 1980“The amendments made by this section [amending this section and ] shall apply to payments made on or after the first day of the first calendar month beginning more than 120 days after the date of the enactment of this Act [].”

, , , provided that:

Effective Date of 1978 Amendment

Pub. L. 95–600, title I, § 101(f)(2)Nov. 6, 197892 Stat. 2771

December 31, 1978“The amendments made by subsection (e) [amending this section] shall apply to remuneration paid after .”

, , , provided that:

Pub. L. 95–600, title I, § 102(d)(2)Nov. 6, 197892 Stat. 2771

December 31, 1978“The amendments made by subsection (c) [amending this section] shall apply with respect to remuneration paid after .”

, , , provided that:

section 601(b)(2) of Pub. L. 95–600Dec. 31, 1978Jan. 1, 1984section 601(d) of Pub. L. 95–600 section 172 of this titleAmendment by applicable with respect to corporations chartered after , and before , see , set out as a note under .

Effective Date of 1977 Amendment

Pub. L. 95–30, title I, § 106(b)May 23, 197791 Stat. 141

April 30, 1977“The amendments made by section 105 [amending this section] shall apply to wages paid after .”

, , , provided that:

Pub. L. 95–30, title IV, § 405(b)May 23, 197791 Stat. 156

April 30, 1977“The amendments made by this section [amending this section] apply to payments made after .”

, , , provided that:

Effective Date of 1976 Amendment

section 401(d) of Pub. L. 94–455Sept. 14, 1976section 401(e) of Pub. L. 94–455 section 32 of this titleAmendment by applicable to wages paid after , see , set out as a note under .

Pub. L. 94–455, title XII, § 1207(f)(3)Oct. 4, 197690 Stat. 1708

Oct. 4, 1976“The amendments made by subsection (d) [amending this section] shall apply to payments of winnings made after the 90th day after the date of the enactment of this Act [].”

, , , provided that:

Effective and Termination Dates of 1975 Amendments

section 2(b)(2) of Pub. L. 94–164Dec. 31, 1975Jan. 1, 1977section 2(g) of Pub. L. 94–164 section 32 of this titleAmendment by applicable to taxable years ending after and before , see , set out as an Effective Date of 1975 Amendment note under .

Pub. L. 94–12, title II, § 209(c)Mar. 29, 197589 Stat. 35 Pub. L. 94–164, § 5(a)(2)Pub. L. 94–331, § 3(a)(2)Pub. L. 94–396, § 2(b)Pub. L. 94–414, § 3(a)(2)

April 30, 1975October 1, 1976“The amendments made by sections 202(b) and 205 [amending this section] shall apply to wages paid after , and before .”

, , , as amended by ; ; ; , provided that:

Effective Date of 1971 Amendment

Pub. L. 92–178, title II, § 208(i)Dec. 10, 197185 Stat. 517

“(1)

January 15, 1972 The amendments made by this section [amending this section] (other than subsection (h)) shall apply with respect to wages paid after .

“(2)

December 31, 1971January 16, 1972 The amendments made by subsection (h) [amending this section] shall apply with respect to wages paid after , and before .”

, , , provided that:

Effective Date of 1969 Amendments

Pub. L. 91–172, title VIII, § 805(h)Dec. 30, 196983 Stat. 709 Pub. L. 99–514, § 2Oct. 22, 1986100 Stat. 2095

“(1)

December 31, 1969 The amendments made by subsections (a), (b), (c), (d), and (e) [amending this section] shall apply with respect to remuneration paid after .

“(2)

section 6051 of this titleApril 30, 1970 The amendment made by subsection (f) [amending this section and ] applies to wages paid after .

“(3)

oDecember 31, 1970June 30, 1970 Subsection () of section 3402 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954], added by subsection (g) of this subsection, shall apply to payments made after . Subsection (p) of such section 3402, added by subsection (g) of this section, shall apply to payments made after .”

, , , as amended by , , , provided that:

Pub. L. 91–53, § 6(b)Aug. 7, 196983 Stat. 96

July 31, 1969January 1, 1970“The amendments made by this section [amending this section] shall apply with respect to wages paid after , and before .”

, , , provided that:

Pub. L. 91–36, § 2(b)June 30, 196983 Stat. 42

June 30, 1969“The amendments made by subsection (a) [amending this section] shall apply with respect to wages paid after .”

, , , provided that:

Effective Date of 1966 Amendment

Pub. L. 89–368, title I, § 101(e)(6)Mar. 15, 196680 Stat. 62

December 31, 1966“The amendments made by paragraphs (1) and (2) of this subsection [amending this section] shall apply only with respect to remuneration paid after , but only with respect to withholding exemptions based on estimation years beginning after such date.”

, , , provided that:

Pub. L. 89–368, title I, § 101(g)Mar. 15, 196680 Stat. 62

April 30, 1966“The amendments made by this section (other than subsection (e) [amending this section]) shall apply only with respect to remuneration paid after .”

, , , provided that:

Effective Date of 1965 Amendments

Pub. L. 89–212 section 6 of Pub. L. 89–212 section 3201 of this titleAmendment by effective only with respect to tips received after 1965, see , set out as a note under .

Pub. L. 89–97 section 313(f) of Pub. L. 89–97 section 6053 of this titleAmendment by applicable only with respect to tips received by employees after 1965, see , set out as an Effective Date note under .

Effective Date of 1964 Amendment

Pub. L. 88–272, title III, § 302(d)Feb. 26, 196478 Stat. 146

Feb. 26, 1964section 1441 of this title“The amendments made by subsections (a) and (b) of this section [amending this section] shall apply with respect to remuneration paid after the seventh day following the date of the enactment of this Act []. The amendment made by subsection (c) of this section [amending ] shall apply with respect to payments made after the seventh day following the date of the enactment of this Act.”

, , , provided that:

Effective Date of 1961 Amendment

Pub. L. 87–256Dec. 31, 1961section 110(h)(4) of Pub. L. 87–256 section 3401 of this titleAmendment by applicable with respect to wages paid after , see , set out as a note under .

Effective Date of 1955 Amendment

Act Aug. 9, 1955, ch. 666, § 3 69 Stat. 605

Aug. 9, 1955“The amendment made by section 2 [amending this section] shall be applicable only with respect to remuneration paid after the date of enactment of this Act [].”

, , provided that:

Savings Provision

Pub. L. 101–508Nov. 5, 1990Nov. 5, 1990section 11821(b) of Pub. L. 101–508 section 45K of this titleFor provisions that nothing in amendment by be construed to affect treatment of certain transactions occurring, property acquired, or items of income, loss, deduction, or credit taken into account prior to , for purposes of determining liability for tax for periods ending after , see , set out as a note under .

Withholding

Pub. L. 119–21, title VII, § 70201(i)July 4, 2025139 Stat. 173

December 31, 2025“The Secretary of the Treasury (or the Secretary’s delegate) shall modify the procedures prescribed under section 3402(a) of the Internal Revenue Code of 1986 for taxable years beginning after , to take into account the deduction allowed under section 224 of such Code (as added by this Act).”

, , , provided that:

Pub. L. 119–21, title VII, § 70202(f)July 4, 2025139 Stat. 175

, , , provided that:

Plan Amendments Not Required Until January 1, 1994

Pub. L. 102–318Jan. 1, 1994section 523 of Pub. L. 102–318 section 401 of this titleFor provisions directing that if any amendments made by subtitle B [§§ 521–523] of title V of require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after , see , set out as a note under .

Withholding Allowances To Reflect New Rate Schedules

Pub. L. 99–514, title XV, § 1581(a)Oct. 22, 1986100 Stat. 2765

“The Secretary of the Treasury or his delegate shall modify the withholding schedules and withholding exemption certificates under section 3402 of the Internal Revenue Code of 1954 [now 1986] to better approximate actual tax liability under the amendments made by this Act [see Tables for classification].”

, , , provided that:

Oct. 1, 1987Employer’s Responsibility Upon Failure of Employee To File Revised Withholding Allowance Certificate Before

Pub. L. 99–514, title XV, § 1581(c)Oct. 22, 1986100 Stat. 2766 Pub. L. 100–647, title I, § 1015(p)Nov. 10, 1988102 Stat. 3572

October 1, 1987“If an employee has not filed a revised withholding allowance certificate before , the employer shall withhold income taxes from the employee’s wages—

“(1)

as if the employee claimed 1 withholding allowance, if the employee checked the ‘single’ box on the employee’s previous withholding allowance certificate, or

“(2)

as if the employee claimed 2 withholding allowances, if the employee checked the ‘married’ box on the employee’s previous withholding allowance certificate.

The preceding sentence shall not apply if its application would result in an increase in the number of withholding allowances for the employee.”

, , , as amended by , , , provided that:

Failure To Deduct and Withhold Under a Duty Created or Increased by Tax Reform Act of 1976

Pub. L. 95–30, title III, § 304May 23, 197791 Stat. 152 Pub. L. 99–514, § 2Oct. 22, 1986100 Stat. 2095

January 1, 1977Pub. L. 94–455“No person shall be liable in respect of any failure to deduct and withhold under section 3402 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954] (relating to income tax collected at source) on remuneration paid before , to the extent that the duty to deduct and withhold was created or increased by any provision of the Tax Reform Act of 1976 [].”

, , , as amended by , , , provided that:

Wages Paid During 1972 and After 1972

Pub. L. 91–172, title VIII, § 805(b)(3)Dec. 30, 196983 Stat. 704 Pub. L. 92–178, title II, § 208(b)(2)Dec. 10, 197185 Stat. 516, (4), , , which provided for section 3402(b)(1) withholding rates of 13.50; 26.90; 29.20; 58.30; 175.00; 350.00; 700.00; and 1.90, effective with respect to wages during 1972, and withholding rates of 14.40; 28.80; 31.30; 62.50; 187.50; 375.00; 750.00; and 2.10, effective with respect to wages paid after 1972, was repealed by , , .

Transitional Determination Status Date

Pub. L. 89–368, title I, § 101(f)Mar. 15, 196680 Stat. 62 Pub. L. 99–514, § 2Oct. 22, 1986100 Stat. 2095

Mar. 15, 1966May 1, 1966May 1, 1966“Notwithstanding section 3402(f)(3)(B) of the Internal Revenue Code of 1986 [formerly I.R.C. 1954], a withholding exemption certificate furnished the employer after the date of the enactment of this Act [] and before , shall take effect with respect to the first payment of wages made on or after , or the 10th day after the date on which such certificate is furnished to the employer, whichever is later, and at the election of the employer such certificate may be made effective with respect to any payment of wages made on or after the date on which such certificate is furnished.”

, , , as amended by , , , provided that:

Meaning of Terms

Act Aug. 9, 1955, ch. 666, § 1 69 Stat. 605

“The terms used in this Act [amending subsecs. (a) and (j) of this section] shall have the same meaning as when used in the Internal Revenue Code.”

, , provided that:

Requirement of withholding

In general

Amount of wages

Percentage method of withholding

Wage bracket withholding

Tax paid by recipient

Included and excluded wages

Withholding allowance

In general

Allowance certificates

On commencement of employment

Change of status

Change of status which affects next calendar year

When certificate takes effect

First certificate furnished

Furnished to take place of existing certificate

In general

Employer may elect earlier effective date

Change of status which affects next year

Period during which certificate remains in effect

Form and contents of certificate

Exemption of certain nonresident aliens

Allowance where certificate with another employer is in effect

Overlapping pay periods, and payment by agent or fiduciary

Alternative methods of computing amount to be withheld

Withholding on basis of average wages

Withholding on basis of annualized wages

Withholding on basis of cumulative wages

Other methods

Changes in withholding

In general

Treatment as tax

Noncash remuneration to retail commission salesman

Tips

Determination and disclosure of marital status

Determination of status by employer

Disclosure of status by employee

Determination of marital status

Withholding allowances

Employees incurring no income tax liability

Extension of withholding to certain payments other than wages

General rule

Definitions

Supplemental unemployment compensation benefits

Annuity

Sick pay

Amount withheld from annuity payments or sick pay

Request for withholding

Special rule for sick pay paid pursuant to certain collective-bargaining agreements

Coordination with withholding on designated distributions under section 3405

Voluntary withholding agreements

Certain Federal payments

In general

Amount withheld

Specified Federal payments

Requests for withholding

Voluntary withholding on unemployment benefits

Authority for other voluntary withholding

Extension of withholding to certain gambling winnings

General rule

Exemption where tax otherwise withheld

Winnings which are subject to withholding

In general

State-conducted lotteries

Sweepstakes, wagering pools, certain pari­mutuel pools, jai alai, and lotteries

Rules for determining proceeds from a wager

Exemption for bingo, keno, and slot machines

Statement by recipient

Coordination with other sections

Extension of withholding to certain taxable payments of Indian casino profits

In general

Exception

Annualized tax

Classes of gaming activities, etc.

Annualization

Alternate withholding procedures

Coordination with other sections

Exemption from withholding for any vehicle fringe benefit

Employer election not to withhold

Employer must furnish W–2

Sweepstakes, wagering pools, certain parimutuel pools, jai alai, and lotteries