What could happen if an employer does not comply with the W-4 submission guidelines?

When an employer does not comply with the W-4 submission guidelines, they could face penalties. Employers are responsible for withholding the correct amount of federal income tax from employee wages based on the information provided in the W-4 form. If an employer fails to ensure that the W-4 forms are completed accurately or does not submit the necessary documentation, they may inadvertently withhold the incorrect amounts. This can lead to under- or over-withholding of taxes, which creates compliance issues with the Internal Revenue Service (IRS).

The IRS may impose penalties on the employer for failing to properly withhold taxes. Additionally, persistent non-compliance or willful neglect in adhering to the guidelines can result in more severe consequences, such as fines or increased scrutiny of the employer's payroll practices by tax authorities. Understanding the importance of following W-4 guidelines is crucial to maintaining compliance and avoiding potential financial repercussions.