Final 199A Guidance on Tracking W-2 Wages Provides Guidance for Short Tax Years, Feb. 7, 2019

Feb. 7, 2019

The IRS has recently finalized the methods that a business owner can use to track W wages for calculating the Section 199A deduction. The new guidance clarifies that, in the case of short taxable years, the business owner is required to use the "tracking wages method" with certain modifications. The total amount of wages subject to incometaxwithholding and reported on Form W can only include amounts that are actually or constructively paid to the employee during the shorttaxyear and reported on a Form W for the calendar year with or within that shorttaxyear. For more information on the methods available for calculating W wages for Section 199A purposes, visitTaxFactsOnline and.