Want our best tax and accounting tips and insights delivered to your inbox?

Sign up for our newsletter.

I confirm this is a service inquiry and not an advertising message or solicitation. By clicking “Submit”, I acknowledge and agree to the creation of an account and to the and .

You May Not Get a Tax Refund Next Year

Article Highlights:

  • Payroll Withholding 
  • W-4 
  • 2018 Tax Projection 
  • Adjusting Withholding 
With all of the tax reform changes and the corresponding reductions in most taxpayers’ income tax withholding, there are serious concerns that the reduction in withholding, although providing more take-home pay now, could end up resulting in unexpected taxes due at tax time next year. For that reason, taxpayers should be overly cautious about their payroll withholding for 2018. One need only look at the W-4 instructions to realize that an individual without any substantial tax training can quickly become lost when filling out the worksheets. It is not business as usual.

What adds to the problem is that many taxpayers count on a refund to pay property taxes, insurance, and other large expenses. The W-4 worksheets are designed to withhold the correct amount of tax with no substantial refund, and many tax practitioners are reporting that clients’ withholdings for 2018 have been reduced to seriously low amounts.

In other years, most taxpayers can look at the tax from their prior year’s return and compare it to their projected payroll withholding to see if their current withholding amount is appropriate. But that’s not the case for 2018, since the tax computation has been substantially altered. Taxpayers with multiple jobs, a working spouse, or complicated returns will find it difficult to adjust their withholding to achieve the desired results.

The same problem exists for retirees with pension income, the difference being that they use a W-4P instead of a W-4.

If you would like this firm to project your 2018 taxes and suggest how to adjust your payroll withholding so you might achieve the outcome you want, please give this office a call.


Share this article...

Serving Clients Virtually and In-Office

1626 Tate Blvd SE
Hickory, North Carolina 28602
Let us take your tax and accounting needs off your hands today.