Do a Paycheck Checkup and See If You Are Taking Home Too Much Money

The Tax Cuts and Jobs Act made major changes to the tax law. Because of this, you should do a paycheck checkup and see if you are taking home too much money using the Withholding Calculator on IRS.gov and, if necessary, complete a new W-4 form. The calculator will help determine the right amount of withholding and can help prevent having too little (or too much) tax withheld.

Recent changes affecting withholding include:

  •  Reduced tax rates
  •  Elimination of personal exemptions
  •  Increased standard deductions: $12,000 for singles, $18,000 for heads of households and $24,000 for married couples filing jointly
  •  Increased child tax credit: $2,000 per qualifying child and a new $500 credit for other qualifying dependents
  • Changes to itemized deductions

This session is for Enrolled Agents, CPAs, and other tax professionals     

A paycheck checkup is especially important if you or your employees:

  • Are you a two-income family
  • Have two or more jobs at the same time or who only work part of the year
  • Claim credits like the child tax credit
  • Have dependents age 17 or older
  • Itemized deductions in 2017
  • Have high income or a complex tax return
  • Have a large tax refund or tax bill for 2017

For more information, please see IRS.gov/taxreform. For updated withholding tables, please visit the IRS newsroom and the IRS withholding table FAQs. I hope this information helps you stay in compliance and maybe you won’t get a big surprise come next April.

Jeffrey Schneider, EA, CTRS, NTPI Fellow has the knowledge and expertise to help you reach a favorable outcome with the IRS. He is the head honcho at SFS Tax & Accounting Services as well as the Enrolled Agent and Certified Tax Resolution Specialist for SFS Tax Problem Solutions.
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For more on SFS Tax & Accounting Services, visit http://sfstaxacct.com/
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Are you taking home too much money? Do a paycheck check and find out.

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