The Tax Cuts and Jobs Act enacted December 2017 made significant changes in personal income tax calculations.
The Internal Revenue Service (IRS) urges employees to review their income tax withholding to avoid being significantly under or over withheld at year end. To assist with this review the IRS has released their new Withholding Calculator . This tool reflects changes in the new tax law and helps determine how many allowances an employee should claim on a Form W-4, Employee’s Withholding Allowance Certificate. A new Form W-4 can be completed and submitted online via e-Business, UNI Employee Self Service.
As a first step to reflect the tax law changes, the IRS released new withholding tables in January. These were designed to produce the correct amount of tax withholding for those with simple tax situations. It’s recommended that individuals with more complicated financial situations consider using the Withholding Calculator, reviewing your taxes, or asking a tax preparer to review. The IRS states that in particular the following groups should check their withholding:
- Two-income families
- People with children who claim credits such as the Child Tax Credit
- People who itemized deductions in 2017
- People with high incomes and more complex tax returns
- People with two or more jobs at the same time or people who only work part of the year
Payroll is unable to provide individuals with tax advice. Concerned employees should consult the irs.gov and/or a professional tax preparer.