The IRS has posted the updated income-tax withholding tables for 2018, which reflect the legislation passed by Congress in December 2017. Employers are encouraged to start using the new tables immediately and are required to do so by February 15, 2018.
Many people may have already seen a difference in their take-home pay as a result of the new withholding. Employees do not have to do anything, as the new tables are designed to work with the W-4 forms that every employee completes at the start of their employment.
The new law features a number of changes that affect individual taxpayers such as:
- Increase in the standard deduction
- Repeal of personal exemptions
- Changes in tax rates and brackets
For those with simple tax situations, the tables are designed to indicate the correct amount of withholding. This will avoid withholding too much or not enough as much as possible.
The new tables can be found here.