A beneficiary must file IRS Form W-4V, Voluntary Withholding Request with the Social Security Administration to authorize voluntary withholding of Federal Income tax. The IRS Form W-4V has allowed individuals to select one of several percentage rates of withholding since this option became available. Therefore, SSA will honor requests for withholding at any of the old or new rates. SSA will apply the rate chosen only if the benefit amount payable after all deductions is more than the amount for tax withholding. The word “NONE” will appear in this box for beneficiaries who do not elect to have tax voluntarily withheld.

In 2012, the IRS began verifying the validity of voluntary tax withholding (VTW) amounts on tax returns pre-refund due to an increase in identity theft with non-compliant VTW claimed on Social Security benefits.  Therefore, if the taxpayer elects voluntary federal income tax withholding on their Social Security benefits, a copy of Form SSA-1099 must accompany their federal tax return to verify the claimed VTW. The Social Security Benefit Statement Instruction Sheet, Form SSA-1099-F2-INST now instructs beneficiaries to attach a copy of their Form SSA-1099 to their federal tax return if an entry appears in the VTW box on the form.