Change Withholding
Check your year-to-date withholding and consider changing the taxes withheld if you are expecting a large refund.
This is especially important if you are claiming the earned income tax credit, or EITC, or the additional child tax credit. Why? The IRS is now required by law to hold all refunds on those returns until Feb. 15. The new law was put into place to allow the agency additional time to detect and prevent tax fraud. Taxpayers may not receive their refunds until Feb 27th.
What Form to Use?
IRS Commissioner John Koskinen said in a statement: “It’s a personal choice if you want to have extra money withheld to get a bigger tax refund, but you have options available if you prefer to have a smaller refund next year and more take-home money now.” You will need to complete Form W-4, Employee’s Withholding Allowance Certificate, to adjust the amount of federal income taxes withheld and submit it to your employer.
- If you’re a CA State employee, you’ll complete the Employee Action Request (EAR) Form to change Federal and State withholding. Submit the form to your HR department.
- If you want withholding from your pension or annuities, you use form W-4P. Send the form to the retirement plan provider.
State withholding:
Nine states do not charge state income tax, according to the Internal Revenue Service (IRS). These states are Alaska, Florida, Nevada, New Hampshire, South Dakota, Texas, Tennessee, Washington and Wyoming. States that collect income generally use the same procedure. Ask your employer for a state income tax form. This form is comparable to the IRS’ W-4. You also can visit your state’s Department of Revenue or taxation department’s website and search for the form.
Tools
Use the IRS Withholding Calculator to help you determine whether you need to change your withholding to avoid having too much or too little Federal income tax withheld from your pay. You can use your results from the calculator to help fill out the W-4 form.
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