The Internal Revenue Service has released the 2026 Form W-4, Employee’s Withholding Certificate. The 2026 form incorporates significant changes reflecting tax law updates, including deductions for tips, overtime compensation, and passenger vehicle loan interest, as well as substantially increased state and local tax (“SALT”) deduction caps.
The child tax credit amount for qualifying children under age 17 increased from $2,000 to $2,200. The state and local tax (SALT) deduction cap increased dramatically from $10,000 to $40,400 ($20,200 if married filing separately). New deductions were added for qualified tips (up to $25,000), qualified overtime compensation (up to $12,500 or $25,000 if married filing jointly), qualified passenger vehicle loan interest (up to $10,000), and a seniors deduction ($6,000 per qualifying taxpayer age 65 or older). The Deductions Worksheet expanded from 5 lines to 15 lines to accommodate these changes, and now includes an itemized deduction limitation for high-income filers.
The form also adds a dedicated “Exempt from withholding” section with a checkbox, replacing the previous method of writing “Exempt” below Step 4(c). Standard deduction amounts increased: $32,200 for married filing jointly (from $30,000), $24,150 for head of household (from $22,500), and $16,100 for single filers (from $15,000). The “(optional)” designation was removed from the Step 4 section header.
The IRS’s 2026 Form W-4 can be found here.
