Treasury Secretary Steven Mnuchin said Thursday that the IRS plans to release a new calculator next week to help people figure out if they need to adjust their tax withholding in light of the new tax law.
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“The IRS will put up a calculator that will allow families to go and double check their withholding based upon the new tax law and update their forms if necessary,” he said at a House Ways and Means Committee hearing. “We’re very pleased at the work that’s being done at the IRS on this.”
The Treasury Department and the IRS last month released guidance about the amount of money that employers should be withholding from their employees’ paychecks for federal taxes. The new withholding guidance reflects three main aspects of the tax law: the lower tax rates, increased standard deduction and repeal of personal exemptions.
Employers have already started to adopt the new withholding tables, leading many to see boosts in their paychecks that Republicans have been highlighting. But Democrats have expressed concerns that some taxpayers who expected refunds may end up having to pay the IRS next year.
Tax experts have said that those with simple tax situations are likely to find the new guidance to be fairly accurate, but that those with more complicated returns could end up owing the IRS money or getting larger refunds than expected. They are encouraging people to look at the IRS’s calculator when it comes out and to consult with their tax advisors.