March 2, 2018

IRS Releases Updated Withholding Calculator and New Form W-4

By Diane Giordano, Partner, Tax & Business Services

IRS Releases Updated Withholding Calculator and New Form W-4 Tax & Business

The Tax Cut and Jobs Act (the “Act”) of 2017 is considered one of the most sweeping tax law bills in more than 30 years.

Of the many changes enacted by the new tax law some of the most significant impact individuals, such as an increased standard deduction, elimination of personal exemptions, the discontinuance of many itemized deductions, and changes to tax rates effective as of January 1, 2018.

As a result of the change in rates, the IRS has issued new 2018 withholding tables. Employers should be using the new tables, which were released in February 2018.

While the new withholding tables are designed to work with existing form W-4s (Employee’s Withholding Allowance Certificate), due to the changes in rates and itemized deductions, many taxpayers may consider changing their payroll withholding allowances. As such, the IRS has also released an updated form W-4.

Taxpayers who should consider checking their withholdings for 2018 include:

  • Two-income families.
  • Taxpayers with two or more jobs at the same time or who only work for part of the year.
  • Taxpayers with children, who claim credits such as the Child Tax Credit.
  • Taxpayers who itemized deductions in 2017.
  • High-income taxpayers and those with complex tax returns.


The IRS has also issued a new withholding calculator for taxpayers to ensure their withholdings are appropriate.

Further information on the new rates and withholding can also be found in the IRS Publication 505: Tax Withholding and Estimated Tax.

Should you have any questions relating to proper withholding or how the new tax law will affect you, contact your Marcum tax advisor.

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