Need to Change Your Federal Tax Withholding? - IRS Has an On-Line Calculator That Can Help
IRS Summertime Tax Tip 2007-08
Did you have too little or too much federal tax withheld from your pay in 2006 – owing money or getting a large refund when you filed your tax return? Have you recently experienced a lifestyle change such as marriage, divorce, new child, home purchase or retirement? Did you start a new job? If any of these situations apply, you may want to adjust your federal tax withholding with your employer. The withholding calculator, on the IRS Web site at IRS.gov can help you figure the correct amount of federal withholding and provide information you can use to complete a new Form W-4, Employee’s Withholding Allowance Certificate.
Before you begin, you need to have a few items handy:
- Your most recent pay stubs.
- Your most recent federal income tax return.
Here are some tips for using the withholding calculator:
- Fill in all information that applies to your situation.
- Estimate when necessary. Remember, the results are only as accurate as the information you input.
- Check out the information links embedded in the program whenever you have a question.
- Print out the final screen that summarizes your input and the results. Use it to complete a new Form W-4 (if necessary) and give the completed W-4 to your employer. Keep the print of the final screen and a copy of your new W-4 with your tax records.
For many people, the withholding calculator is a great tool that can simplify the process of determining your withholding. However, if you are subject to the alternative minimum tax or self-employment tax or if your current job will end before the end of the year, you will probably achieve more accurate withholding by following the instructions in Publication 919, How Do I Adjust My Tax Withholding, which is available at IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676).
Links:
IRS Withholding Calculator
IRS Publication 919
07-31-2007, 06:27 PM
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