Niles-Maine District Library

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Time for a paycheck checkup

Money matters…

I like to save money. I pack a lunch for work, use cloth grocery bags, and shop smart. I pay bills on time and plan for retirement. All of which allows me an indulgence at the local coffee shop more often than not.

And when tax time comes around I have saved and am willing to pay my share. So of course I was interested in the impact of the new Tax Cuts and Jobs Act on my income (and my coffee habit).

The IRS always recommends employees check their withholding each year to make sure they’re having the right amount of tax withheld from their paychecks. This year it is most important that this is checked. Updates under the new law include sharp limits to itemized deductions and an overhaul of the tax withholding that applies to your wages.

I do not like surprises and this one could creep upon you so take the time right now to assess your own personal situation.

Use the IRS’s Withholding Calculator and, if necessary, complete a new  W-4 form. The calculator helps determine the right amount of withholding.

You should check if you:

  • Are a two-income family.
  • Have two or more jobs at the same time or only work part of the year.
  • Claim credits like the child tax credit.
  • Have dependents age 17 or older.
  • Itemized deductions in 2017.
  • Have high income or a complex tax return.
  • Have a large tax refund or tax bill for 2017.

YouTube videos

Other resources and general information

See IRS.gov/taxreform for more information.

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