Updated October 16, 2026. Quick answer: Form W-4R sets federal income tax withholding on nonperiodic payments and eligible rollover distributions from an employer plan, annuity or IRA. The default rate is 10% for a nonperiodic payment and 20% for an eligible rollover distribution. Line 2 can raise either rate, but the form says an eligible rollover distribution cannot go below 20%.
IRS worksheets read line by line: W-4 Multiple Jobs Worksheet and W-4P Deductions Worksheet.
Related reading on this site: IRS Publication 505.
Retirement forms read line by line: Form W-4R lines 1a and 1b and Form W-4R line 2.
Read box by box from the IRS form text: Form 1099-R boxes explained, Form 1099-R box 4 and Form 1099-R boxes 14 to 19.
What Form W-4R covers and what it leaves to Form W-4P
The form is addressed to the payer: “Give Form W-4R to the payer of your retirement payments.” The general instructions describe the scope: “Complete Form W-4R to have payers withhold the correct amount of federal income tax from your nonperiodic payment or eligible rollover distribution from an employer retirement plan, annuity (including a commercial annuity), or individual retirement arrangement (IRA).”
Periodic payments are carved out: “Don’t use Form W-4R for periodic payments (payments made in installments at regular intervals over a period of more than 1 year) from these plans or arrangements.” Those use Form W-4P. An IRA creates a boundary case: “Distributions from an IRA that are payable on demand are treated as nonperiodic payments.”
There is no multi-step layout like the W-4P. The first page has an identity block and a single choice, line 2, plus the signature. The signature box carries the validity rule: “Your signature (This form is not valid unless you sign it.)” Nonresident aliens are excluded: “Do not use Form W-4R.” The form points them to other IRS publications.
The two default rates
The top of the first page lays out both defaults side by side. It opens with a sentence about the logic: “Your withholding rate is determined by the type of payment you will receive.”
| Type of payment | Default rate | What line 2 allows |
|---|---|---|
| Nonperiodic payment | “For nonperiodic payments, the default withholding rate is 10%.” | “You can choose to have a different rate by entering a rate between 0% and 100% on line 2.” |
| Eligible rollover distribution | “For an eligible rollover distribution, the default withholding rate is 20%.” | “You can choose a rate greater than 20% by entering the rate on line 2. You may not choose a rate less than 20%.” |
The nonperiodic rule is repeated on page 2 with a warning: “Your payer must withhold at a default 10% rate from the taxable amount of nonperiodic payments unless you enter a different rate on line 2.” “Note that the default rate of withholding may not be appropriate for your tax situation.” For payments sent abroad there is a floor: “Generally, you can’t choose less than 10% for payments to be delivered outside the United States and its territories.”
The eligible rollover rule is longer: “Distributions you receive from qualified retirement plans (for example, 401(k) plans and section 457(b) plans maintained by a governmental employer) or tax-sheltered annuities that are eligible to be rolled over to an IRA or qualified plan are subject to a 20% default rate of withholding on the taxable amount of the distribution.” It follows with a caution: “Note that the default rate of withholding may be too low for your tax situation.”
Because the 20% default applies without any paperwork, the form says when a certificate is even needed for this type: “Don’t give Form W-4R to your payer unless you want more than 20% withheld.” The 20% rule is discussed from the plan’s side on the 20 percent withholding page.
Which payments are eligible rollover distributions
Whether the 20% rate applies depends on whether the payment is eligible to be rolled over. The form lists categories that are not: “Note that the following payments are not eligible rollover distributions for purposes of these withholding rules:”
| Category | Listed on the form as not an eligible rollover distribution |
|---|---|
| Required minimum distributions | “Distributions required by federal law, such as required minimum distributions” |
| Disaster recovery | “Qualified disaster recovery distributions” |
| Birth or adoption | “Qualified birth or adoption distributions” |
| Long-term care | “Qualified long-term care distributions” |
| Emergency expenses | “Emergency personal expense distributions” |
The list also includes qualifying hardship distributions, distributions from a pension-linked emergency savings account and eligible distributions to a domestic abuse victim. For details the form says “See Pub. 505 for details.” The form does not use the words direct rollover, so how a transfer straight from one plan or IRA to another is treated for withholding is not answered by this form. The related reporting codes are covered on the Form 1099-R box 7 codes page, and eligibility of a pension annuity is covered on the pension annuity rollover page.
Line 2: more, less or none
Line 2 is the only entry that changes the rate. The page 1 wording is: “Complete this line if you would like a rate of withholding that is different from the default withholding rate.” The line takes a whole number: “Enter the rate as a whole number (no decimals)”
More withholding is open for both payment types: “If you want more than the default rate withheld from your payment, you may enter a higher rate on line 2.”
Less withholding is limited to one type. The page 2 heading says “Less withholding (nonperiodic payments only).” The form also covers a missing certificate: “then the payer must withhold 10% of the payment for federal income tax and can’t honor requests to have a lower (or no) amount withheld.”
A form election carries forward: “Your withholding choice (or an election not to have withholding on a nonperiodic payment) will generally apply to any future payment from the same plan or IRA.” “Submit a new Form W-4R if you want to change your election.” The caution states the stakes: “If you have too little tax withheld, you will generally owe tax when you file your tax return and may owe a penalty unless you make timely payments of estimated tax.”
Using the marginal rate tables, with the IRS examples
The first page includes tables by filing status. The form’s advice on using them is: “Consider using the Marginal Rate Tables on page 1 to help you select the appropriate withholding rate for this payment or distribution.” It defines the term: “The marginal tax rate is the rate of tax on each additional dollar of income you receive above a particular amount of income.” The table for single filers and married filing separately is below.
| Total income over (dollars) | Tax rate for every dollar more |
|---|---|
| 0 | 0% |
| 16,100 | 10% |
| 28,500 | 12% |
| 66,500 | 22% |
| 121,800 | 24% |
| 217,875 | 32% |
| 272,325 | 35% |
| 656,700 | 37% |
A footnote changes the top row for one status: “If married filing separately, use $400,450 instead for this 37% rate.” The tables for married filing jointly and for head of household are printed on the form itself.
The method has two steps: “Step 1: Find the rate that corresponds with your total income not including the payment. Step 2: Add your total income and the taxable amount of the payment and find the corresponding rate.” “If these two rates are the same, enter that rate on line 2.” There is also a shortcut: “If you prefer a simpler approach (but one that may lead to overwithholding), find the rate that corresponds to your total income including the payment and enter that rate on line 2.”
The IRS examples that follow use the same facts:
| Case | As printed |
|---|---|
| Facts for both examples | “Your filing status is single. You expect the taxable amount of your payment to be $20,000.” |
| Example 1, same rate before and after | Total income without the payment is $70,000 and with it $90,000. Both fall in the 22% row of the table, so the two rates are the same and 22 goes on line 2. |
| Example 2, the rates differ | “Multiply $6,500 by 12% to get $780. Multiply $13,500 by 22% to get $2,970. The sum of these two amounts is $3,750.” “This amount corresponds to 19% of the $20,000 payment ($3,750 divided by $20,000).” |
The general tax brackets for 2026 are on the 2026 tax brackets page.
Publication 505 states the same two default rates in plain terms: “Tax will be withheld at a flat 10% rate on any nonperiodic payments you receive, unless you choose a different withholding rate.” For payments that can be rolled over, it says they “are subject to a 20% default rate of withholding on the taxable amount of the distribution.”
The edition read for this page is Form W-4R for 2026, which is the revision irs.gov served when it was read on 2026-10-16. The marginal rate tables on page 1 are specific to that year, so check the revision printed on the form you give to a payer.
Common mistakes
- Sending Form W-4R to ask for less than 20% on an eligible rollover distribution. The form says that rate cannot be lowered below 20%, and that a form is not needed unless more than 20% is wanted.
- Treating a payable-on-demand IRA distribution as periodic. The form says these are treated as nonperiodic payments, so the 10% default applies unless line 2 changes it.
- Relying on the default rate as the right amount. The form itself warns that the default rate may not be appropriate, or may be too low, for the person’s tax situation.
Related: 20 percent withholding on a pension lump sum, is a pension annuity eligible for rollover, Form 1099-R box 7 codes, and 2026 tax brackets.
Find the right next step for your situation
About how much do you have invested? Pick the range that fits; your next step appears immediately below.
Compare vetted advisors for retirement rollovers
For U.S. investors with $250,000 or more in investable assets. WiserAdvisor is an independent service matching you with 2 to 3 vetted advisers. Its form asks for your ZIP code and answers to a few questions; a match is not guaranteed.
Free to request, with no obligation to hire. By submitting, you consent to calls, texts and emails from WiserAdvisor and up to three advisers. Advisers pay for introductions.
Clear Money Guide may earn a referral payment for a qualifying completed form. An introduction is not a Clear Money Guide recommendation.
Opens on WiserAdvisor’s site in a new tab.
See how an advisor plans a rollover
Price the destination before you decide. The matching service below introduces you to advisers who pay to meet you.
Before you start, what actually happens. The form is run by Kapitalwise, our advisor-matching partner. Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide may earn a referral payment for a qualifying submitted form, whether or not you ever hire anyone. This is free to you and there is no obligation to hire anyone.
The Kapitalwise form opens here; you stay on this page.
What happens when you press the button
It asks about nine questions: age, investable assets, location; then your name, email and phone number, and verifies the phone by text. Nothing loads and nothing reaches Kapitalwise until you press the button.
Prefer flat-fee or hourly pricing instead? Compare ranges here.
Answer againSources
- Form W-4R (2026), Withholding Certificate for Nonperiodic Payments and Eligible Rollover Distributions: https://www.irs.gov/pub/irs-pdf/fw4r.pdf
- Publication 505 (2026), Tax Withholding and Estimated Tax: https://www.irs.gov/pub/irs-pdf/p505.pdf
Read from the IRS documents linked above on October 16, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.