Less withholding from your paycheck means more money in your paycheck.
An excellent article from our friends at Investopedia (Investopedia.com) titled: Coming Soon: A Bigger Paycheck by Jim Probasco (October 5, 2018) outlines the basic elements of the new withholding system, including useful tables.
Here is the link to the ‘early release’ by the IRS of the 2018 Percentage Method Tables for Income Tax Withholding: https://www.irs.gov/pub/irs-pdf/n1036.pdf
Remember, the 2018 changes do not go into effect until 2019. You file your 2018 taxes in 2019.
It is anticipated that individuals will not see any changes in their paycheck until February, 2019, or later.
For Employers: According to the IRS table (for employers)…” In addition to withholding Medicare tax at 1.45%, you must withhold a 0.9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year.”
It is beyond the scope of this article to assess what the impact will be in individual cases. If you have questions, consult with a professional.
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