New Tax Withholding Tables Issued
The IRS has released new income tax withholding tables that reflect new tax rates and other changes for individuals as a result of the Tax Cuts and Jobs Act. Employers have until February 15, 2018 to put the new withholding rules into effect, but the IRS recommends updating them as soon as possible. With these changes, the IRS expects that many employees should see an increase in their take-home pay.
Employers will not need to request updated W-4s from employees as the new withholding tables are designed to work with the existing form. The IRS does plan to issue a new Form W-4 in the near future and should also release an updated online withholding tax calculator by the end of February.
If you handle your payroll in house using QuickBooks, here are some tips to update your withholding tables:
- If using QuickBooks Online, any changes in the withholding rate will be automatically updated.
- If using QuickBooks Desktop (with an active payroll subscription in 2015 version or later), download Payroll Update 21804 released on January 18, 2018. Please refer to this link for more information on the update: QuickBooks Desktop News & Updates.
- If you do not have an active payroll service with QuickBooks, you will need to manually calculate the tax withholding. IRS Tax tables can be found in IRS Notice 1036: https://www.irs.gov/pub/irs-pdf/n1036.pdf
If you outsource your payroll, your provider should update tax tables. Check with your provider to see when you should expect to see the changes in effect.
Please call of our office at 225-300-8478 if you have any questions in regards to these changes, and one of our staff members will be glad to assist you.
For further reference:
IRS Withholding Tables Frequently Asked Questions