Wednesday, 23 May 2018 17:05

Is it Time to do a “Paycheck Checkup”?

The Internal Revenue Service has made a recent announcement suggesting part-year or seasonal employees to do a “paycheck checkup”. The changes made from The Tax Cuts and Jobs Act (enacted earlier in the year) have made some significant differences in how the withholding tax gets calculated this year.  Part-year and seasonal workers are especially vulnerable to incorrect calculations due to the limited or shorter period of employment, instead of calculating income on the entire year of employment.


The easiest way for a part-year or seasonal employee to do a checkup is to visit The Withholding Calculator on IRS.gov. The calculator has been designed to help estimate income and deductions to make sure the right amount of tax is being withheld. Based on the results of the calculator, employees can then change their filing and allowances on Form W-4 to update their tax withholding.

 

More information can be found at the IRS news release here: https://www.irs.gov/newsroom/seasonal-part-year-workers-urged-to-check-tax-withholding-amount

The Withholding Calculator can be found here: https://www.irs.gov/individuals/irs-withholding-calculator