As a followup to my two posts last week on mid-year withholding checkup and estimated tax checkup, I found another notice from the IRS last week that pointed out there are certain groups of people really need to do a
checkup. This alert was part of the IRS’ communication IR-2018-80.
Special alert for key groups to check withholding
The IRS always recommends employees check their withholding at the beginning of each year or when their personal circumstances change to make sure they’re having the right amount of tax withheld from their paychecks.
Following the recent tax law changes, it’s especially important for certain people to use the Withholding Calculator on IRS.gov to check if they are having the right amount of withholding.
Among the groups, in particular, who should check their withholding are people who:
- Belong to a two-income family.
- Work two or more jobs or only work for part of the year.
- Have children and claim credits such as the Child Tax Credit.
- Have older dependents, including children age 17 or older.
- Itemized deductions on their 2017 tax returns.
- Earn high incomes and have more complex tax returns.
- Received large tax refunds or had large tax bills for 2017.
“The IRS urges people in these groups to take a few minutes and review their withholding and tax situation,” Kautter said. “Taking this step will help avoid surprises next year at tax time. ”
The new law increased the standard deduction, removed personal exemptions, increased the child tax credit, limited or discontinued certain deductions, and changed the tax rates and brackets.
If you fit into one of those groups and need more information on how to do a mid-year withholding checkup, see the article at the link.
Sterling Raskie, MSFS, CFP®, ChFC®
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