One of the most well-known changes in the Tax Cuts and Jobs Act is the adjustment to tax brackets. While many Americans may be paying less in tax than last year, there are still those who need to double check their tax withholding to avoid a surprise tax bill come April 15. That’s why the Internal Revenue Service has periodically dedicated Tax Tips to withholding, advising specific groups to revisit how much of their paycheck is set aside for Uncle Sam.
The group the IRS identified is fairly diverse. From seasonal workers to high-income earners, the agency outlined several situations that warranted revisiting withholding in an August Tax Tip covering how to file a new W-4:
• “Two-income families
• People working two or more jobs or who only work for part of the year
• People with children who claim credits such as the Child Tax Credit
• People with older dependents, including children age 17 or older
• People who itemized deductions on their 2017 tax return
• People with high incomes and more complex tax returns
• People with large tax refunds or large tax bills for 2017”
The important thing to remember is that revisiting withholding means an opportunity to sit down for a tax planning session with clients, and those who regularly submit a several-pages-long Form 1099-B certainly qualify as someone with a “more complex tax return.”
While you’ll probably spend more time helping clients prepare for withholding and other TCJA changes, you might be thinking about ways to help you save time when it comes to actually preparing those returns. Luckily, tax automation services like GruntWorx Trades can shave a lot of time off the preparation side of your business.