Does your software send the W-4 to the IRS?

No, this is no longer required. (In the past, you had to submit any W-4s when the employee claimed complete exemption or more than 10 allowances.) However, if the IRS ever requests a W-4, you must provide it. Be aware, too, the IRS could notify you in writing if the employee isn’t entitled to a complete exemption or the number of claimed allowances. This “lock-in” letter will indicate the maximum allowable allowances; you must process the new withholding within 60 days of the date of the letter.