It’s February 1 and you may have noticed more money in your paycheck this week. If not, you should very soon.
Some 90 percent of workers who get a paycheck are expected to see more take-home pay from tax reform beginning in February!
The GOP-tax bill passed by Congress in December is taking effect. Employers are implementing new tax rates and other tax changes for workers.
The IRS released new withholding tables in January. Based on your filing status (such as married, single, or head of household) and your pay frequency (i.e. weekly, biweekly, semimonthly, monthly, or annually), you can look up how much your tax rate is and how much your employer should withhold in income taxes.
Tax rates aren't the only changes. The new tables reflect increases to the standard deduction – which was nearly doubled – and the repeal of personal exemptions.
The left-leaning Tax Policy Center finds that the tax bill would reduce taxes on average for all income groups this year. In addition, they predict that over 80 percent of tax units will receive a tax cut of $2,140 on average.
The IRS made it clear that employers must begin using these new rates immediately, but no later than February 15, 2018.
Keep an eye on your paychecks and let us know how much more you’re taking home thanks to tax reform.
**Tweet us at @IWV with the #MyWallet hashtag to let us know how tax reform has affected your paycheck! We'll feature some of the best tweets on our feed and in an upcoming blog post!