As we near the end of the year, it’s important to do a “Paycheck Checkup” so you’re not surprised by your tax bill come April.
The Tax Cuts and Jobs Act was passed by the Trump administration and went into effect on January 1, 2018. This Act made sweeping changes to the Internal Revenue Code; thereby affecting income tax brackets and allowable personal tax deductions. For these reasons, the IRS is urging everyone to perform a “paycheck checkup.” The amount of income tax withheld from your paycheck depends on the amount of income earned and the information provided on your W4.
To perform this task, you will need to visit the IRS.gov website and use the IRS Withholding Calculator. This tool helps identify what your proper tax withholding should be throughout the year. Withholding the correct amount can help protect you from having too little withheld, resulting in an unexpected tax bill when you file your 2018 taxes. On the flip side, performing this task can also help you from withholding too much. The IRS reports the average tax refund tops out at $2,800.00. Adjusting your withholdings could give you more money in your take home pay.
It is easy to complete a “Paycheck Checkup.” Just grab your most recent pay stub and click on the link below!
Melissa Herzog, Payroll Manager