IRS Tax Reform Tax Tip 2018-154, October 3, 2018 The IRS recommends taxpayers use the Withholding Calculator to do a “paycheck checkup” as soon as possible. This will help taxpayers check that they are having the correct amount of income tax withheld from their paychecks. Earlier this year the IRS updated the Withholding Calculator tool on IRS.gov to reflect changes in the Tax Cuts and Jobs Act passed in December. Doing a checkup can help protect against having too little tax withheld and facing an unexpected tax bill or penalty at tax time in 2019. Some taxpayers might prefer to have less tax withheld up front and receive more in their paychecks, which would reduce their tax refund next year. While it’s a good idea for everyone to check their withholding, it’s especially important for these people to use the Withholding Calculator to make sure they have the right amount of tax withheld: Two-income families People with two or more jobs at the same time or who only work for part of the year People who claim credits such as the Child Tax Credit People who claim older dependents, including children age 17 or over People who itemized deductions in 2017 People with high incomes and more complex tax returns People with large tax refunds or large tax bills for 2017 Remember, the Withholding Calculator does not ask the user for personally identifiable information, such as name, social security number, address, or bank account numbers. The IRS does not save or record the information the taxpayer enters in the calculator. Subscribe to IRS Tax Tips
