It's Check-Up Time ─ For Your Tax Withholding!

9/1/2018 | Written by: Selena Quintanilla, CRTP
Each year, health care providers nationwide send us reminders to schedule our annual checkups. Is it a coincidence that my reminder pops up in my mailbox right after a tax filing deadline? Maybe. Maybe not. In any case, just as many of us need to be prompted to take care of our physical health, we sometimes need a reminder to evaluate our tax situations to avoid unwanted surprises in the future. This is your reminder to perform a paycheck checkup! 

With so many changes unfolding under the new tax law, and with life moving as quickly as it does, reviewing the amount withheld from your paycheck is crucial. In fact, the IRS reports that many taxpayers are expected to see a shift in their refund amounts when filing their 2018 tax returns in 2019. 

The most significant changes introduced under the Tax Cuts and Jobs Act include:
 
  • Adjustments to the tax rates and brackets 
  • Limitations on, or the suspension of, certain deductions 
  • Elimination of personal exemptions 
  • Increase in both the standard deduction and the Child Tax Credit 
These changes will notably affect taxpayers with a dual income household, as well as taxpayers who:  
 
  • Have complicated tax returns 
  • Have high income 
  • Hold multiple jobs at the same time 
  • Worked only part of the year 
  • Itemized their deductions in 2017 
  • Received a large tax bill or refund for 2017 
Additionally, if you experienced any significant life changes during the year such as marriage, landing a new job, or welcoming a new addition into your family, you should check your withholding amounts now, while there are still a few months left in the tax year.

For more information on paycheck checkups and some self-help tools, please visit the IRS website at IRS.gov.