Form W-4P is a short form, but it points to a greater accounting need. The document, also known as the Withholding Certificate for Pension or Annuity Payments, is used to indicate whether federal income tax should be withheld from a pension or annuity. More specifically, employees will be able to indicate the exact amount they want withheld from each pension or annuity payment. Still, while Form W-4P is short, it has several pages of instructions. This points to a greater complexity. The W-4P is one of two specialized versions of the W-4.
While employees may need some time to complete this form, employers and accountants will face their own set of challenges. The document is used to change withholding on payments, which means it is up to the employer to ensure those changes are reflected in pension or annuity benefits. As a business owner, you will need to retain this information alongside the employee’s Form W-4, record the data, and make the necessary changes inside your payment system. This can take a lot of work, especially if several employees file the document at once.
The easiest way to handle this form is to invest in a comprehensive software solution, like those provided by AMS. Our modules support W-4P and can help you integrate the recorded information into necessary payment processes.
Changes to the Withholding Certificate for Pension or Annuity Payments Form
While there have been no recent changes to this form, the IRS recommends that all employees submit new W-4s and Form W-4Ps, if they haven’t already, by October 2020. Employers are urged to help with the process.
Software Solutions for Form W-4P
Employee tax situations can change from year to year. To help your employees calculate the appropriate withholding, you should encourage them to complete a new version of this form, when applicable, every year. But, while this can support your workers’ tax efficiency, this puts a greater burden on you. You will need to make the adjustments necessary to withhold the correct amount from pensions and annuities.
Software tools from Advanced Micro Solutions can help alleviate that stress. Our Forms Filer Plus ($49) directly supports Form W-4P. This means users will be able to complete the document inside the software, then print or store digitally for later use. If employers also use AMS Payroll ($134), our semi-automated payroll software, they will be able to use the information recorded on Form W-4P to make changes to payments. For those who need robust W-4 and W-4P support, we recommend combining these software tools. You’ll be able to store essential data, then apply it to essential paycheck and pension calculations. Plus, both tools support a range of federal forms for additional filing support.
W2 - 1099 Forms Filer Pricing
|AMS W2 & 1099 Software|
Additional Support from AMS
Our software works modularly. This means products can be integrated in any combination, allowing users to pay only for the services they need. While the Forms Filer Plus and AMS Payroll are great solutions for all tax and payroll forms, you may have additional accounting needs. Our full catalogue is listed below.
- W2/1099 Forms Filer (required purchase) – $84
- Payroll Module – $134
- E-File Direct – $154
- Affordable Care Act Filer
- 1042-S Filer
- Software-Generated Forms
- Forms Filer Plus – $54