Paycheck Checkup

If you typically itemize your deductions on Schedule A of Form 1040, you may want to use the IRS Withholding Calculator to perform a “paycheck checkup.” Recent tax law changes may affect your tax rate, and the IRS Withholding Calculator will help ensure your employer is withholding the appropriate amount of tax from your paycheck.

There are two main reasons to check your withholding:

  1. It could help protect against having too little tax withheld and facing an unexpected tax bill or penalty at tax time next year.
  2. With the average refund topping around $2,800, you may prefer to have less tax withheld and receive more in your paychecks.

If you need to change your withholding, give your employer a new Form W-4 (Employee’s Withholding Allowance Certificate).

 


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