If you’ve been holding your breath waiting for new W-2s and other payroll forms in 2025, you can relax at least for now.
The IRS announced that for tax year 2025, as part of the phased rollout of the One Big Beautiful Bill Act (OBBBA), there will be no changes to:
- Form W-2
- Existing Forms 1099s
- Form 941 and other payroll return forms
- Federal income tax withholding tables
That means employers and payroll providers will continue using the same reporting and withholding procedures they’ve been using. The IRS has not yet released guidance on how overtime and other OBBBA-related payroll changes will be reported on existing forms. It is possible this additional information may be reported in box 14 of Form W-2 or added as an option in box 12. Tips will be reported in box 8 as in the past, but again, there has not been specific information on what will be required in each area.
The IRS recently released a fact sheet for more information on how these changes can affect your clients if they are in an industry that receives tips or have overtime pay. Payroll administrators will need to track those changes from the date of the tax law change.
Why the wait?
The IRS says this decision is all about avoiding disruption during filing season and giving employers, payroll providers and tax professionals time to adapt before changes kick in. By holding off until 2026, the IRS hopes to avoid errors that could lead to over- or under-withholding.
What’s next?
The action begins in 2026. Expect new guidance, updated forms, and changes to how tips and overtime pay are reported. Clients can also expect more details on how to file for OBBBA-related benefits they may be eligible for.
What this means for you:
If you prepare payroll or advise clients on withholding, you don’t need to overhaul your process for 2025. But it’s a great time to review your current systems so you’ll be ready for next year’s changes. Educate your clients and let them know there are no changes for this year. Stay connected to NATP updates to keep clients in the loop and be ready to help them navigate new rules as they arrive.
About National Association of Tax ProfessionalsThe National Association of Tax Professionals (NATP) is the largest association dedicated to equipping tax professionals with the resources, connections and education they need to provide the highest level of service to their clients. NATP is comprised of over 23,000 leading tax professionals who believe in a superior standard of ethics and exemplify professional excellence. Members rely on NATP to deliver professional connections, content expertise and advocacy that provides them with the support they need to best serve their clients. The organization welcomes all tax professionals in their quest to continually meet the needs of the public, no matter where they are in their careers.
The NATP headquarters is located in Appleton, WI. To learn more, visit www.natptax.com.
Information included in this article is accurate as of the publish date. This post is not reflective of tax law changes or IRS guidance that may have occurred after the date of publishing.