Thanks for reaching out on this. The IRS has said in their webinars that they prefer Employers use the 25% method. They have instructed that we have a written policy acknowledged by
all employees to combat complaints. When we have no policy, allowing employees to change the W-4 each time is the safest way to go.
However, in an audit we will face increased scrutiny
for not choosing a method, writing a policy and following through.
The IRS truly prefers 25%.
September 2017
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