Adjust your paycheck withholding now to avoid a tax shock

The Idaho State Tax Commission is urging you review your federal Form W-4 now to ensure you’re withholding enough from your paycheck for state and federal income taxes.

With significant changes to state and federal tax laws, you could be among many taxpayers who are having too little money withheld from your paychecks to cover the taxes you’ll owe for 2018.

That’s especially true if you have more than one job or both you and your spouse work.

“There’s still time to adjust your paycheck withholding,” Tax Commission Chairman Ken Roberts said, “but waiting longer increases the chances for a tax shock.”

Roberts said employees should contact their human resources department or tax preparer for help or take these three easy steps:

Use the withholding calculator at IRS.gov to estimate your federal withholding. Use the 2018 W-4 Worksheet for Idaho at tax.idaho.gov to estimate your Idaho withholding. Make any needed changes to Form W-4 and give it to your employer.

Idaho doesn’t have a separate W-4 form at this time. You should use the federal W-4 to update both your state and federal withholding allowances.

“Taxpayers who have already updated their federal withholding also should update their Idaho withholding,” Roberts said. “Using the federal allowance number for Idaho could result in too little money–or too much–being withheld to cover your state taxes.”