If you use the IRS tax withholding calculator, you might want to run your results by your accountant before you adjust the amount of income taxes that are pulled from your paycheck.
That’s because user error and failure to consider your state and local tax loads could lead to you making incorrect adjustments to your withholding.
The IRS, which has just released its new income tax form, also has new tax withholding tables, reflecting changes stemming from the Tax Cuts and Jobs Act.
The new legislation roughly doubled the standard deduction, did away with personal exemptions and trimmed individual income tax rates.
Filers are supposed to use the new withholding calculator to determine what, if any, changes they should make at work to ensure that they’re paying just the right amount of tax at every pay period.
Just make sure you recheck your data with your accountant before you make any changes, tax experts say.
“A lot of people don’t understand the line items and you have to make sure you’re accounting for that accurately,” said certified financial planner Debbie J. Freeman, a CPA and director of financial planning at Peak Financial Advisors in Denver.
“Unless you understand taxes, it’s not something you should fully rely on,” she said.
Source : CNBC
