W4 Withholding Program
Lock-In Response to IRS
Piedmont SC 29673
Internal Revenue Service-Compliance Services
Withholding Compliance Program
PO Box 9047, stop 834 ANSC
Andover , MA 01810
Reply Code: 0866143529
Employer: AAA Copper
Response to Lock in letter
Attention: Maureen Judge, Operations Manager, Collections
You sent me the lock in letter (LTR 2801C) dated May 8, 2006, copy attached.
I did not claim a complete exemption from withholding or an exempt status. My W-4 form was correct as best as I could figure.
Your said letter stated very clearly that my employer was not to change my W-4 form for 30 days form the date of your letter. Also he is not to change my W-4 form while I am attempting to comply with your instructions.
I am entitled to claim withholding allowances under the law to reduce my withholding to approximately what I will pay at the end of the year.
I have submitted a new W-4 form to my employer claiming 3 allowances which I can easily justify. The information you need includes:
- My Social Security number is listed above and my wife’s number is 678-12-3456.
- I am entitled to allowances for myself and my spouse. Also since she is not gainfully employed, I am entitled to an additional allowance for her.
- I give to my church both a tithe and a generous offering plus incur a great deal of in-kind expenses, such as transportation for the Youth Group, providing goods and transportation for church activities, perform maintenance on the church facilities at my own expense for equipment and supplies.
I provide more than 20% of my gross income to the church and am entitled to claim 2 allowances for that.
Attached is a copy of my new W-4 form which I recently gave to my employer. If I have not figured this correctly, please let me know.
Letter to Employer
Piedmont SC 29673
AAA Copper Company
Attention Payroll Dept
Dover , AL 36302
RE: Employee Steve Patriot
Employee Number 123
Dear Payroll Manager,
The IRS service center in Andover , MA sent you on May 8, 2006 their “lock-in letter” which instructed you to change a federal form that I had signed under penalties of perjury. This was the form W-4 Employee’s Withholding Allowance Certificate. This form was correct when I initially prepared it.
That letter, in small print on the back, also provided that you were to hold off for 30 days until I had a chance to respond to the IRS. If you alter that federal form prior to the deadline stated, you will be in serious violation of federal law.
The said IRS notice also provides that I have an opportunity to contest the “lock-in letter” administratively and further you are not to alter my form until this dispute is resolved. IRC §3402(n) provides that the company is not allowed to alter a US Government form listing my allowances which I signed under penalty of perjury. Therefore the IRS directive cannot go into effect until this issue is resolved.
Attached is a copy of my reply to the said “lock-in letter” which states my position very clearly. Also enclosed is my new W-4 form which lists the allowances that I am legally entitled to claim.
Appeal of Lock-in Letter
Piedmont SC 29673
Date: June 30, 2006
TO: MAUREEN JUDGE
OPERATION MANAGER, COLLECTIONS
PO BOX 9041, STOP 843 ANSC
ANDOVER MA 01810-0947
RE: SSN: 123 45 6789
Employer: AAA COPPER
ADMINISTRATIVE APPEAL OF ADVERSE DETERMINATION
Your letter dated June 7, 2006, attached, denied my appeal dated May 15, 2006, which contested your lock-in letter dated May 8, 2006.
I hereby appeal the lock-in letter and your administrative confirmation of it to your supervisor or to the appropriate appeals body.
Please send me the necessary forms and information so that I can appeal this adverse determination and make an administrative appeal to the proper appeals court.
My new W4 form, which I sent to you on May 15,2006 was correct and you have no grounds to deny it.
The IRS has no authority under any Congressional enactment to alter or change my W4 form. The IRS has no regulation which has an enabling statute to allow the regulation to exist that interferes with my withholding forms.
IRC 3402n clearly states that the employer is not allowed in any way to alter the withholding certificate submitted by the employee. Your lock-in letter in denial of my appeal has no basis in law.
Notice of Repeal of Lock-in Legislation
To: Payroll Department
From: Charles Patriot
RE: Repeal of the IRS Regulation on W4 forms.
On April 14, 2005 the Internal Revenue Service rescinded their regulation dealing with their Lock-In Letter pertaining to the allowances on the Employee W-4 Form. The said IRS Regulation 26 CFR Part 31, FR Doc. 05-7523, dated April 11, 2005 is attached.
You can read for yourself the attached regulation and see that the IRS repealed their regulation telling you to alter federal government forms. You can send this regulation to the company CPAs and tax lawyers and have them explain why you must leave my W4 form alone.
Incidentally the enabling statute which allowed the IRS to issue the lock-in letter was never passed by Congress. Consequently the IRS was operating outside the law from the beginning.
I hope we can resolve this matter quickly without litigation.
How the IRS Lies to Employers About Withholding
Not by Dr Clarkson. FYI
“Truth is the first object.” –Thomas Jefferson to Dr. Maese, 1809. ME 12:232
In my recent article on How The IRS Violates It’s Own Code , the facts were carefully presented which definitively proved how the IRS deliberately lies and misleads Americans by unlawfully seizing (stealing) assets by circumventing the law.
This article will prove how the American worker and employer alike have been hoodwinked regarding the withholding process. The purpose behind this chicanery is not to benefit America, but to further enrich the coffers of the private banking cartel aka the Federal Reserve.
There is no need for an income tax, flat tax, sales tax or any other direct tax. All Americans are encouraged to look behind the curtain so that they might fully understand the grand plunder sucking the lifeblood out of our economy. Don’t be fooled by this current illusion of a “booming economy.” Debt is not prosperity.
So says the Great Deceivers, the Internal Revenue Service. Employers are routinely told that they must, under certain provisions of the tax code, withhold taxes of all sorts from an employee’s paycheck. Funny thing though, when sincere Americans request that the IRS send its representatives to public seminars on this issue, the IRS is no where to be found.
In not one of those 37 cities did either DOJ or IRS send any representative, begging the question, “Why not?” Schulz is a man of honesty and integrity. His invitations to DOJ and IRS were sincere; his only desire was to be absolutely certain that the information he communicated to attendees was legally factual. Instead, he was met with the same usual arrogance in the form of silence. Why do you suppose that is?
Abracadabra, courtesy of the IRS
A well know Patriot researcher tell us:
“The IRS will tell employers and employees that according to IRC section 3402(a)(1) of their code: “. every employer making payment of wages shall deduct and withhold upon such wages a tax determined in accordance with tables or computational procedures prescribed by the Secretary.”
“However, this is what the law really says: no (federal, state, city or county) municipal corporation shall levy or collect or cause to be levied or collected any tax upon the income, or any part thereof, of any person, resident or nonresident (also known as the “Full Paycheck Law”). Employers are prohibited from taking amounts from pay for federal or state taxes, fees or other charges absent the lawful, knowing, written consent of the employee.
“The Code of Federal Regulations clearly advises the employers at 26 CFR §31.3402(p)-1(a) “An employee who desires to enter into an agreement for withholding. shall furnish his employer with Form W-4 (or its equivalent) for withholding. The furnishing of such Form W-4 shall constitute a request for withholding.” Then, 31 CFR §215.2(n)(1) clearly tells the employers they cannot take amounts from the workers’ pay for any form of State tax UNLESS the employee VOLUNTARILY elects to have such sums withheld.
“Consensual taking from pay occurs ONLY when an employee voluntarily elects in writing to volunteer to participate in any (federal, state, city or county) municipal corporate tax, program, insurance (disability, Medicare), trust (social security), including non-judicial tax levy, garnishment for taxes, tax offsets, tax interest or penalty and the employer consents such a request.”
The fruits of your labor belong to you
Pursuant to 26 CFR §31.3402(p)-1(b)(2), either the employer or the employee may terminate the withholding agreement (W-4 or its equivalent) by furnishing a signed written notice to the other. An employer cannot lawfully take amounts from the worker’s pay without the risk of being sued after the worker submits his/her written notice to terminate the withholding agreement (W-4 or its equivalent).
According to Ms. Wall, when the employer’s tax professionals (CPA or attorney) are the ones negligently advising the company to convert and transmit the worker’s property (pay), those incompetent tax professionals are at risk of being sued for negligence, malpractice and misfeasance. Sheds a whole new light on things, doesn’t it?
State laws protect workers from non-consensual taking from pay without the worker’s explicit, knowing, voluntary, written consent. Only the worker or contractor/payee can make the determination whether or not he/she wants to volunteer to participate in government taxes, fees or other charges (i.e., social security trust contributions [FICA], social programs [Medicare], benefits [disability]) as well as non-judicial liens/levies, penalties and interest.
By all means, every employee and employer should go to the law library and verify the information above. It is accurate, it is factual and it is the law on the books. Don’t take the word of the IRS for anything. Check the facts for yourself. Then sit down and have a heart to heart chat with your tax professional and find out why he/she doesn’t know the law. After all, they’re supposed to be the experts looking out for you, the client.
Unlawfully penalizing employers
The IRS threatens employers with huge fines if they don’t withhold payroll taxes. Funny thing though, according to a September 15, 2003 letter from GAO (General Accounting Office) to Congressman Elton Gallegly regarding W-4’s and reporting, this little nugget of truth stands out:
“Under current law, IRS does not have statutory authority to impose a penalty to enforce employer compliance with the reporting requirement. The reporting requirement was promulgated in Treasury regulations.”
How many employers has the IRS defrauded for untold millions of dollars in fines when in fact, they had no legal authority to impose or enforce such penalties and fines?
The IRS likes to use a lot of rhetoric about “tax cheats” who won’t “pay their fair share.” When one lifts the curtain and exposes the lies and fraud being conducted every day by the IRS, one would venture to say that the real “tax cheats” are those who work for the IRS.
Employers are being fleeced to the tune of approximately 30% of their operating budget in “payroll deductions.” The worker over a ten year period with $200 of taxes withheld each pay period, would get clipped for $104,000! For what? Certainly not to fund our military, social security or any other legitimate, authorized expenditure by Congress. Those expenditures are funded through borrowing by Congress. Debt is not prosperity.
The American workers and employers have been cheated long enough. If someone owns the fruits of your labor, stolen from you by deceptive and deceitful methods, then you are a slave. The withholding issue was sold under the guise of patriotism because the American people did not want this new taxing scheme back in 1942. Sixty-one years later, the American people still don’t want this fleecing of the fruits of their labor which does not benefit them in any way. This process only encourages addictive over spending by Congress and more borrowing from the central bank. Again, debt is not prosperity.
We the people have two choices: You can either stay on your knees to this tyranny or you can get the facts and then enforce your rights using the law.
What future will you pass on to your children and grand babies? Freedom or indentured servitude?
IRS Lock-In Letters: IRS Published “Guidance”
Withholding Compliance Questions & Answers
Q1: In the past, as an employer, I was required to submit all Forms W-4 that claimed complete exemption from withholding (when $200 or more in weekly wages were regularly expected) or claimed more than 10 allowances. What Forms W-4 do I now have to submit to the IRS?
A1: Employers are no longer required to routinely submit Forms W-4 to the IRS. However, in certain circumstances, the IRS may direct you to submit copies of Forms W-4 for certain employees in order to ensure that the employees have adequate withholding. You are now required to submit the Forms W-4 to IRS only if directed to do so in a written notice or pursuant to specified criteria set forth in future published guidance.
Q2: If an employer no longer has to submit Forms W-4 claiming complete exemption from withholding or claiming more than 10 allowances, how does the IRS determine adequate withholding?
A2: The IRS is making more effective use of information contained in its records along with information reported on Form W-2 wage statements to ensure that employees have enough federal income tax withheld.
Q3: If the IRS determines that an employee does not have enough federal income tax withheld, what will an employer be asked to do?
A3: If the IRS determines that an employee does not have enough withholding, we will notify you to increase the amount of withholding tax by issuing a lock-in letter that specifies the maximum number of withholding allowances permitted for the employee. You will also receive a copy for the employee that identifies the maximum number of withholding exemptions permitted and the process by which the employee can provide additional information to the IRS for purposes of determining the appropriate number of withholding exemptions. If the employee still works for you, you must furnish the employee copy to the employee. If the employee no longer works for you, you must send a written response to the IRS office designated in the lock-in letter indicating that the employee is no longer employed by you. The employee will be given a period of time before the lock-in rate is effective to submit for approval to the IRS a new Form W-4 and a statement supporting the claims made on the Form W-4 that would decrease federal income tax withholding. The employee must send the Form W-4 and statement directly to the IRS office designated on the lock-in letter. You must withhold tax in accordance with the lock-in letter as of the date specified in the lock-in letter, unless otherwise notified by the IRS. You will be required to take this action no sooner than 45 calendar days after the date of the lock-in letter. Once a lock-in rate is effective, an employer can not decrease withholding unless approved by the IRS.
Q4: As an employer, after I lock in withholding on an employee based on a lock-in letter from the IRS, what do I do if I receive a revised Form W-4 from the employee?
A4: After the receipt of a lock-in letter, you must disregard any Form W-4 that decreases the amount of withholding. The employee must submit for approval to the IRS any new Form W-4 and a statement supporting the claims made on the Form W-4 that would decrease federal income tax withholding. The employee should send the Form W-4 and statement directly to the address on the lock-in letter. The IRS will notify you to withhold at a specific rate if the employee’s request is approved. However, if, at any time, the employee furnishes a Form W-4 that claims a number of withholding allowances less than the maximum number specified in the lock-in letter, the employer must increase withholding by withholding tax based on that Form W-4.
Q5: I have been directed to lock in an employee’s withholding. What happens if I do not lock in the employee’s withholding as directed?
A5: Those employers who do not follow the IRS lock-in instructions will be liable for paying the additional amount of tax that should have been withheld.
Q6: Our employees can submit or change their Forms W-4 on line. How can I prevent them from changing their Forms W-4 after they have been locked-in by the IRS?
A6: You will need to block employees who have been locked-in from using an on line Form W-4 system to decrease their withholding.
Q7: What should I do if an employee submits a valid Form W-4 that appears to be claiming an incorrect withholding amount?
A7: You should withhold federal income tax based on the allowances claimed on the Form W-4. But, you should advise the employee that the IRS may review withholding to ensure it is adequate, and that the IRS may direct you, as the employer, to withhold income tax for the employee at a certain rate if the review indicates the employee’s withholding is inadequate. Once this occurs the employee will not be allowed to decrease their withholding unless approved by the IRS.
Q8: What do I do if an employee hands me a substitute Form W-4 developed by the employee?
A8: Employers may refuse to accept a substitute form developed by an employee and the employee submitting such a form will be treated as failing to furnish a Form W-4. In such case, you should inform the employee that you will not accept this form and offer the employee an opportunity to complete an official Form W-4 or a substitute Form W-4 developed by you. Until the employee furnishes a new Form W-4, the employer must withhold from the employee as from a single person claiming no allowances; if, however, a prior Form W-4 is in effect for the employee, the employer must continue to withhold based on the prior Form W-4. As an employer, a substitute withholding exemption certificate developed by you can be used in lieu of the official Form W-4, if you provide all the tables, instructions, and worksheets contained in the Form W-4 in effect at that time to the employee.
Q9: What do I do if an employee hands me an official IRS Form W-4 that is clearly altered?
A9: Any alteration of a Form W-4 (e.g. crossed out penalties of perjury statement above the signature) will cause the Form W-4 to be invalid. If an employer receives an invalid Form W-4, the employee will be treated as failing to furnish a Form W-4; the employer must inform the employee that the Form W-4 is invalid, and must request another Form W-4 from the employee. Until the employee furnishes a new Form W-4, the employer must withhold from the employee as from a single per son claiming no allowances. If, however, a prior Form W-4 is in effect for the employee, the employer must continue to withhold based on the prior Form W-4.
Q10: I heard my employer no longer has to routinely submit Forms W-4 to the IRS. How will this affect me as an employee?
A10: There is no change in the requirement that employees have adequate income tax withholding. The withholding calculator found on the IRS website is available to help employees determine the proper amount of federal income tax withholding. Another useful resource, Publication 919, How Do I Adjust My Tax Withholding? is available on the IRS Web site or can be obtained by calling 1-800-TAX-FORM (829-3676). Individuals who do not have sufficient income tax withholding are subject to penalties. The IRS will be making more effective use of information contained in its records along with information reported on Form W-2 wage statements to ensure that employees have enough federal income tax withheld.
Q11: As an employee, what happens if the IRS determines that I do not have adequate withholding?
A11: The IRS may direct your employer to withhold federal income tax at an increased rate to ensure you have adequate withholding by issuing a lock-in letter. At that point, your employer must disregard any Form W-4 that decreases the amount of withholding. You will receive a copy of the lock-in letter. You will be given a period of time before the lock-in rate is put in effect to submit for approval to the IRS a new Form W-4 and a statement supporting the claims made on the Form W-4 that would decrease your federal income tax withholding. You should send the Form W-4 and statement directly to the address on the lock-in letter. Once a lock-in letter is issued, you will not be allowed to decrease your withholding unless approved by the IRS.
Q12: What if I don’t want to submit a Form W-4 to my employer?
A12: Your employer is required to withhold income tax from your wages as if you are single with zero allowances if you do not submit a Form W-4.
IRS Instructions on W-4 Form
LAWS PERTAINING TO W-4 FORMS
Many employers and their accountants find themselves caught in a fight between their loyal employees and an agency of the U.S. Government. However, the non-combatants can easily protect themselves by obeying the law. The applicable laws and court decisions include:
1. Internal Revenue Code §3402. In this section of the United States Code, Congress has enacted all the provisions dealing with employee withholding. lnsofaras the course of action for an employer when receiving a W-4 certificate, the law clearly speaks for itself:
NOTWITHSTANDING ANY OTHER PROVISION OF THIS SECTION, AN EMPLOYER SHALL NOT BE REQUIRED TO DEDUCT AND WITHHOLD ANY TAX UNDER THIS CHAPTER UPON A PAYMENT OF WAGES TO AN EMPLOYEE IF THERE IS IN EFFECT WITH RESPECT TO SUCH PAYMENT A WITHHOLDING EXEMPTION CERTIFICATE FURNISHED TO THE EMPLOYER BY THE EMPLOYEE CERTIFYING THAT THE EMPLOYEE (IS EXEMPT FROM WITHHOLDING). 26 USC §3402 (n)
The applicable IRS regulation as to responsibility of private companies:
THE EMPLOYER IS NOT REQUIRED TO ASCERTAIN WHETHER OR NOT THE NUMBER OF WITHHOLDING EXEMPTIONS CLAIMED IS GREATER THAN THE NUMBER OF WITHHOLDING EXEMPTIONS TO WHICH THE EMPLOYEE IS ENTITLED.’ IRS Regulation 31 .3401 (e) (b).
So, the employer only has the duty to honor W-4 forms as filed, not to make any determination. According to current IRS procedures, the companies can notify the tax agency that a worker has claimed exempt or whatever on the W-4 form, but the payroll department still can not be made responsible to amend any form.
3. The awesome Revenue Service cannot help you: This matter is between the Plaintiff (employee) and the Defendants (employer) and the Internal Revenue Service has no interest in the circumstances of this action (and is) not a party. Stahoviak v. Denver and RGW Railroad Co., #79CV205, Routt County, Colorado 21 Jan 80.
4. Whose business is it? Again the Federal Courts have taken a common sense approach and held, as we could easily expect, that the matter of paying taxes is between the taxpayer and his tax collector and should not involve the workplace:
"Unless the withholder has reason to know that the party filing form (W-4) is no longer eligible for exemption, the withholding party is not responsible for misstatements made on form (W-4) by an owner of income and hence is not liable for tax which would have been withheld. Defendants manifest concern as to whether the Plaintiff would pay tax . but this is none of their concern." Holmstrom v. PPG Industries, 512 F. Supp 552 (1981)
5. Who makes the DETERMINATION? Many low-level IRS agents claim they can, but do they have the authority? The applicable law, §3402 (n) above, indicates they do not. Legally a worker meeting certain criteria can use his withholding certificate to halt advance tax collections and interest free use of his money. The tax collector legally must wait until April 15th for his share.
A private company as even the IRS admits, has no authority to make any decision regarding worker’s tax status! And once a DETERMINATION is made, who has the authority to actually change the W-4 form itself, in the absence of any legislation. Only the Courts can say:
THE EMPLOYER IS NOT AUTHORIZED TO ALTER THE FORM OR TO DISHONOR THE EMPLOYEE’S CLAIM. THE CERTIFICATE GOES INTO EFFECT AUTOMATICALLY IN ACCORDANCE WITH CERTAIN STANDARDS ENUMERATED IN (IRC) 3402 (f) (3) . US V. MALINKOWSKI, 347 F. SUPP. 352 (1972).
6. No Altering: The company can not alter any government form or status of the employee. The IRS does not even claim that authority. The employer who cooperates with any agent without a court order is in legal jeopardy. The best policy for the company is to kindly request from the IRS a Court Order.
Even though some low-level administrative agent of the Internal Revenue Service may send the company a form letter advising them to disregard an employee’s W-4 form, most companies simply ignore such advice letter and save themselves the expensive cost of litigation and damages.
Most employers, Federal and State agencies simply ignore the letter and respond by requesting the writers legal authority to make such a demand on a private company. After all, even Revenue admits no enforcement mechanism exists to compel a paymaster to change a worker’s W-4 form nor can any penalties be laid on the wise employer who obeys the law and honors the withholding certificate as filed.
Prepared by the Patriot Network 515 Concord Avenue; Anderson, SC 29621
MacPHERSON LETTER W-4
ATTORNEYS AT LAW
Donald W. Macpherson, P.C.
NOVEMBER 18, 1980
President CSRA Patriots
Augusta, Ga. 30903
Re: I.R.S. Forms W-4
This is in response to your recent request regarding the question as to whether
or not an employer must honor the Form W-4 filed by the employee. Also, you
asked whether or not an employer may change the Form W-4 filed by the
employee, or change the status of the employee with regard to withholding; i.e.,
change the amount of withholding. Your final question was the potential liability
of an employer with regard to changing a Form W-4E of the employee, or
changing the withholding status of said employee.
U.S.C. §3402 and the numerous regulations promulgated there under.
First, the law requires that every employee file with his employer a Form W-4.
Next, the employer has no obligation to verify the number of withholding
allowances claimed by the employee. As indicated in Circular E, if the employer
thinks the employee
claimed too many allowances or made a false statement on the form, the
employer should notify the I.R.S. District Director. Further, the 1960 regulations
(rules promulgated by the I.R.S. Commissioner but not law passed by Congress)
require the employer to report to the I.R.S. any Form W-4 filed with ten or more
allowances. And they provide that the I.R.S. may determine if a W-4 is "defective, in which case the employer is to change the employee’s withholding status. Section 31.
I have found within the Code (the law passed by Congress) no express nor implied authority which provides that the employer change the Form W-4 of the employee, or change the withholding status of the employee, except in a situation where the form W-4 filed by the employee is deemed "invalid The regulations deal with the definition of an invalid form as any alteration or unauthorized addition. See regulation S3l.3402(f)2-(l) (e)
It was the intent of Congress to allow those individual taxpayers to determine, on their own, their withholding status, and to require that the employer follow said status, except in a case of an "invalid certificate, as discussed above. Congress was particularly concerned with the fact that the withholding tables are based on the assumption that an employee will work throughout the entire year, an assumption quite erroneous in the case of, for example, construction workers.
Congress noted that: "many taxpayers who work only part of the year have tax withheld from their wages even though they have no tax liability for that year. Congress, therefore, developed a rule as to filing of a W-4E or W-4 exempt. They also noted that: "in conjunction with the higher-filing requirement, this certification provision could potentially relieve as many as 10 million persons from over withholding although it is unlikely that all those potentially eligible would take advantage of this procedure.’ (Emphasis added.) See Senate Report # 91-552 (1969)
The statutes and regulations are all premised on the concept that an employee is responsible to himself, his employer and the I.R.S. for filing what he believes to be the correct number of withholding allowances. In my opinion, it would be a dangerous choice of action for an employer to change the Form W-4 or withholding status of the employee. There have been numerous lawsuits recently filed by employees against employers for said unlawful action. I know of one case pending in the State of Colorado in which the judge denied the Employer’s Motion to Dismiss the lawsuit, which lawsuit was filed under the Civil Rights Act and claimed a violation of constitutional rights and requested a substantial amount of damages.
It is my recommendation that if the employer finds himself caught between a Form W-4 filed by the employee and a mandate from the I.R.S. requiring change of the withholding status, said employer should either request the I.R.S. to beg off, or said employer should file an interpleader with the Court. Interpleader action is one in which a third party "stakeholder states to the Court that he has no interest in the outcome but wishes to escape liability from wither of the opposing parties. In other words, the employer requests that the Court determine whether or not the employee or the I.R.S. is correct with regard to the the employee. Said course of action is the most prudent and conservative approach.
Prior to filing said interpleader, I recommend that the employer request the IRS to beg off the question. If the IRS persists, interpleader should be filed.
Under our present law, I see no provision which allows for the IRS to assess the employer with any tax not withheld so long as the employer withholds tax based on a form W-4 exempt, 3402 (n) provides that:
"Notwithstanding any provision of this section, an employer shall be required to deduct and withhold any tax under this chapter on a payment of wages to an employee if there is in effect with respect to such payment a