Senator Raps New W-4 Form, Urges Revision

The new W-4 tax-withholding form is so complex that it ought to be withdrawn and simplified, the chairman of the Senate Finance Committee said today.

The chairman, Sen. Lloyd Bentsen (D-Tex.), said in a letter to Lawrence Gibbs, commissioner of the Internal Revenue Service, “I have heard from a number of concerned individuals and businesses about the complexity of the new W-4. . . . Upon reviewing the form, I must echo these concerns.”

Bentsen also wrote, “Although I recognize that the IRS was working under a mandate from Congress to devise a more accurate form, our goals will not be realized if workers are unable to decipher the form because of its complexity. . . .

‘Short’ Form Suggested

“Please review the situation and let me know if the service could devise a simpler process, such as making the new W-4 form optional or allowing taxpayers to choose a ‘short’ form instead,” Bentsen urged.

Every person who works for an employer is required to file a new W-4 form by Oct. 1, chiefly because of the major changes in taxation brought about by the 1986 tax-overhaul law.

However, a taxpayer who waits until late in the year to complete the form could find that not nearly enough tax was withheld in the early part of the year. That could result in a penalty.

For that reason, many employers already are distributing the new forms and urging workers to fill them out.

The form is filed with the employer, not with the IRS. And, although the new W-4 with its instructions runs four pages--double the size of the old one--the form itself is basically the same seven lines as in the past.

Rod Young, an IRS spokesman, emphasized today that the work sheet is for the convenience of the worker and does not have to be completed--so long as the proper number of withholding allowances is claimed.