Final regs issued on periodic payment withholding

Tax Hot Topics newsletter The IRS issued final regulations (TD 9920) on withholding from periodic payments for pensions, annuities and other deferred income. The final regulations adopt proposed regulations issued in May without any modifications (for more details on the proposed regulations, see our prior coverage), including in response to two taxpayer comments on the proposed regulations regarding the default rate of withholding for periodic payments. However, the IRS indicated the comments remain under consideration for future revisions to forms, instructions, publications and other guidance relating to withholding on periodic payments, including revisions to the Form W-4P, “Withholding Certificate for Pension or Annuity Payments.” The final regulations apply to periodic payments made after Dec. 31, 2020.

Jeff Martin
Washington National Tax Office
T +1 202 521 1526

Keith Mong
Managing Director
Washington National Tax Office
+1 202 521 1554

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