22 THE QUEENS COURIER • JANUARY 3, 2019 FOR BREAKING NEWS VISIT WWW.QNS.COM
TAX TIPS
30 Million People
Are Not Withholding
Enough Taxes
BY JOHN SAVIGNANO, CPA
21 percent of taxpayers – or about 30 million people – aren’t
withholding enough taxes from their pay this year. Earlier this year, the
IRS and Treasury changed the withholding tables to reflect the new tax
law. You should review your withholding to make sure you’re on track.
Here's another reason to revisit your tax withholding: Just over 2 in 10
taxpayers will owe money to the IRS next year. Those were the findings
from a report by the Government Accountability Office, a legislative
agency that provides data to Congress. The percentage amounts to
about 30 million people.
On the other hand, GAO said, nearly three-quarters of taxpayers will
have withheld too much during 2018 and will receive a refund next year.
Earlier this year, the Treasury Department and the IRS released
updated withholding tables to reflect the new Tax Cuts and Jobs Act.
Changes stemming from the new law include the end of personal
exemptions, the doubling of the standard deduction and lower
individual income tax rates.
The withholding tables are guidelines your employer follows in order
to deduct the appropriate amount of income taxes from your paycheck.
They also work with Form W-4, which you can use to tailor the taxes
withheld from your pay.
The GAO also found that under the old tax law, 18 percent of taxpayers
— roughly 27 million people — would have not withheld enough
money.
Review your forms
Reviewing your W-4 is a good practice in any tax year. If not enough
is withheld, you'll owe money come tax time. Pay too much, and you
end up with a large refund.
The IRS also released an updated version of its withholding calculator
to help taxpayers figure out how much to have deducted from each
paycheck.
You may have different circumstances now compared to when you
started working at your employer.
Major life changes, including having a child or getting married, may
warrant an update to your withholding.
Itemizing deductions
In the past, it may have made sense for people who itemize deductions
to claim more allowances on their W-4 and have less tax withheld.
This may no longer be the case since the standard deduction has
nearly doubled to $12,000 for singles and $24,000 for married couples
who file jointly.
About 49 million taxpayers — 28 percent of filers — itemize.
Now that the standard deduction has doubled, filers who once itemized
may no longer do so. That means they may not claim as many
allowances on their W-4.
Also, the Tax Cuts and Jobs Act does away with personal and dependent
exemptions and broadens the applicability of the child tax credit to
include higher-income households.
Given the changes in the tax code, it's a good time to look at your W-4.
You don't want any surprises, especially when that surprise is a large
balance due come tax time.
John Savignano is a partner with Savignano Accountants & Advisors
located at 47-46 Vernon Blvd., Second Floor, in Long Island City. If you
have any questions or require additional information, please call John at
718-707-0955.
No W-2 required to apply.
Nov. 19 - Jan. 11
Hernan Barona, E.A
hernan@savignano-cpa.com
www.savignano-cpa.com
ObtainMyRefund.com
41-18 Crescent St., Long Island City, NY 11101
T: 718-707-0295 • F: 718-707-0299
E: hernan@savignano-cpa.com
www.savignano-cpa.com
47-46 Vernon Blvd Second Floor
Long Island City, NY 11101
T: 718-707-0955 • F: 718-707-0959
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