2018 Tax Reform Withholding Notice

As you know, the new Tax Cuts and Jobs Act enacts many changes for all taxpayers. This letter is meant to aid in understanding and, if necessary, re-calibrating your tax withholding. With the elimination of personal exemptions and reduced or eliminated itemized deductions for upcoming tax years, the IRS updated their withholding tax charts which decreased withholding for 2018. As a result, your current withholding may not be enough to cover your taxes for the 2018 tax year.

            The IRS has provided a Withholding Calculator as well as updating the W-4 form. There are a few things to keep in mind before using the calculator. The IRS does not keep record of calculator uses, and does not ask for any identifying information. The IRS will never send emails or phone calls to promote, encourage, or require any disclosure of personal information. Never enter or give out your social security number if you are unsure of the legitimacy of the person/website asking. Be vigilant, as there are cybercriminals impersonating the IRS, especially via email and telephone calls. The IRS does not send emails related to the calculator or the information entered.

To use the calculator to the best of its ability, you should gather a few things before you begin:

  1. Your most recent pay stub
  2. A final/complete copy of your 2017 tax return
  3. An awareness of any special circumstances that affected you in 2017 that will not occur in 2018, or vice versa.

Withholding Calculator Link:  IRS Withholding Calculator

Once the calculator has aided in understanding your withholding, the IRS has also issued a new W-4 form to report your updated withholding to your employer. If you want to increase your withholding, please click on the link below once you’ve utilized the withholding calculator. Once you complete this form, print or download and give to your employer.

Updated W-4 2018            

If you need any assistance using or understanding the withholding calculator or filling out your W-4, or have any other questions or concerns, do not hesitate to contact our office. You may contact us by responding to this email, giving us a phone call, or scheduling an appointment at your local Kandi Harper, CPA office.