Automating Annual Expiration of “Exempt” Federal W‑4 and Defaulting Withholding After Feb 15

Summary:

Per IRS Topic 753, employees who claim “Exempt” from federal income tax withholding on Form W‑4 must submit a new W‑4 each calendar year. If a new exempt W‑4 is not received by February 15, employers are required to default federal withholding to Single (or Married Filing Separately) with no adjustments, effective from that point forward.

We wanted to understand how this can be handled in Oracle Fusion HCM Payroll from an automation and compliance standpoint.

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