The IRS has finalized regulations, pursuant to Internal Revenue Code §§ 6051 and 6052, that allow for TIN masking on W-2s beginning in tax year 2020 (for forms to be filed in 2021). The Tax Cuts and Jobs Act, passed in 2017, allowed for the IRS to implement this regulation for purposes of identity theft protection and anti-fraud measures.
The regulations, pursuant to IRC § 6109, promulgate that TINs may only be masked on copies furnished to the payee, not those filed with the IRS. Masking is permitted, but not required. The same rules that apply to Truncated TINs (TTINs) generally are to be applicable here.
