• IRA Rollover
  • Impact our future through planned giving

    Impact our future through planned giving

    • Touch the lives of others while creating a lasting legacy
    • Find peace of mind through a wide variety of tax benefits
    • Help the University of Michigan achieve its goals for current and future generations
Text Resize
Print
Email
Subsribe to RSS Feed

Monday August 20, 2018

Washington News

Washington Hotline

IRS Encourages Taxpayers to Check Their Withholding Amounts

The IRS is conducting a second "paycheck checkup" the week of August 13 in an effort to encourage taxpayers to calculate withholding amounts for their 2018 returns. In light of the new tax law, many tax filers will need to adjust their withholding amounts.

The Tax Cuts and Jobs Act (TCJA) will affect 2018 tax returns. The TCJA increased the standard deduction, increased the Child Tax Credit, limited or discontinued certain itemized deductions and changed tax rates and brackets. Because of these changes, the IRS encourages taxpayers to check and adjust their withholding amounts now in order to avoid an unexpected tax bill and penalties next year.

Those whose withholding amounts could be particularly impacted include individuals who:
  • Have two or more incomes per family
  • Work only part of the year or hold two or more jobs at the same time
  • Claim credits like the Child Tax Credit
  • Had a large refund or tax bill in 2017
  • Have dependents age 17 or older
  • Have a large amount of income or a complex tax return
  • Claimed itemized deductions in 2017
The IRS encourages taxpayers to utilize the online Withholding Calculator on irs.gov to help determine their withholding amounts. When using the Withholding Calculator, taxpayers should have a copy of a recent paystub and their 2017 tax return handy. The calculator does not require personally-identifiable information, such as names, Social Security numbers, addresses or bank account numbers.

By conducting a "paycheck checkup" now, not only can taxpayers steer clear of an unwelcome tax surprise come tax season, but they can avoid an inflated refund and have more money in each paycheck for the remainder of the year. Even if a taxpayer has already used the Withholding Calculator earlier in the year to determine their withholding amount, they should consider whether their personal circumstances have changed such that they should revisit the calculator to see if their withholding amount should be updated.

For more information, taxpayers can review Publication 505, Tax Withholding and Estimated Tax, available on irs.gov. The IRS will also be holding special sessions for tax professionals to discuss withholding requirements on August 15 and 16.

Published August 10, 2018
Print
Email
Subsribe to RSS Feed

Previous Articles

IRS Public Wi-Fi Security Tips

IRS Urges Strong Passwords

IRS Promotes "Security Six" Computer Safeguards

IRS Summertime Tax Tips

"Almost a Postcard" Tax Return

scriptsknown

The University of Michigan has 501(c)(3) non-profit tax exempt status; our federal tax ID number is 38-6006309.

Copyright © 2018 Regents of the University of Michigan
The University of Michigan Office of Development, 3003 South State Street, Suite 9000, Ann Arbor, MI 48109-1288

© 2018 Crescendo Interactive, Inc. PRIVACY STATEMENT
This site is informational and educational in nature. It is not offering professional tax, legal, or accounting advice.
For specific advice about the effect of any planning concept on your tax or financial situation or with your estate, please consult a qualified professional advisor.