WASHINGTON, D.C. — The IRS is launching a special campaign starting Sept. 6 to help specific groups of taxpayers avoid an estimated tax penalty by paying the right amount of tax all year.
This campaign will help wage earners, retirees, small business and self-employed individuals to meet the upcoming Sept. 17 deadline for quarterly estimated tax payments. It will also encourage them to perform a Paycheck Checkup at www.irs.gov/individuals/irs-withholding-calculator.
Because of the far-reaching tax changes taking effect this year, doing a Paycheck Checkup now may help avoid an unexpected year-end tax bill and possibly a penalty in 2019. The Tax Cuts and Jobs Act, passed in December 2017, made significant changes, which will affect 2018 tax returns that people file in 2019. These changes make checking withholding amounts even more important.
These tax law changes include:
• Increased the standard deduction
• Eliminated personal exemptions
• Increased the Child Tax Credit
• Limited or discontinued certain deductions
• Changed the tax rates and brackets