Nov 142018
 

How to get a jump on next years taxes. Withholding, what you need to know. Due to changes in the Tax Cuts and Jobs Act, many taxpayers withholding went down in early 2918, giving them more money in their paychecks in 2018. You may receive a small refund-or even owe an unexpected tax bill-when you file your 2018 tax return next year, especially if you did not adjust your withholding after the withholding table changed. Other changes that affect you and your family include increasing the standard deduction, suspending personal exemptions, increasing the child tax credit, adding a new credit for other dependents and limiting or discontinuing certain deductions.

How to get a jump on next years taxes. What you need to do. Use the IRS Withholding Calculator to perform a paycheck checkup to help you decide if you need to adjust your withholding or make estimated payments now. Use your results from the calculator to submit a new Form W-4, Employee’s Withholding Allowance Certificate, to your employer. Make estimated or additional tax payments if the withholding from yur salary, pension or other income doesn’t cover the 2018 income tax that you’ll owe for the tax year. Form 1040-ES, Estimated Tax for Individuals also has a worksheet to help you figure your estimated payments.

What you need to know. Expecting a refund ? Some refunds cannot be issued before mid-February. By law, the IRS cannot issue refunds before mid-February for tax returns that claim the Earned Income Credit or the Additional Child Tax Credit. This applies to the entire refund, even the portion not associated with these credits. While the IRS will process your return when it is received, it cannot issue EITC/ACTC related refunds before mid-February. Your refund may be different-or you may even owe an unexpected tax bill-when you fle your 2018 tax return next year. New tax law may affect the tax refund you expect next year. Review IRS publication 5307, Tax Reform Basics for more information.


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