The IRS has been encouraging taxpayers to perform a “paycheck checkup” to check if they are having their employer withhold the right amount of tax for their situation, after changes in law adopted in the Tax Cuts and Jobs Act.
For some people, their job or family situation makes it more likely that tax-table calculated withholding will not properly account for their projected tax liability. It’s especially important for these people to check their withholding. They 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.
Add to this list people who have recently changed jobs, people whose children will be turning 17 soon, and people beginning retirement.
The first step in checking your withholding is to gather some information. Normally, a recent pay stub and a copy of last year's tax return should be a good start.
Go to the IRS withholding calculator at https://www.irs.gov/individuals/irs-withholding-calculator
The calculator will not ask for your social security number or other sensitive information.
If you find your required withholding is significantly different from the actual withholding indicated by your pay stubs, download Form W-4 and give it to your employer to initiate a change in your withholding.
