Tax withholding in the United States

Tax withholding in the United States

In the United States income tax system, employers are required to withhold a portion of each employee's income and pay it directly to the U.S. Internal Revenue Service. This withholding acts as a prepayment of tax they will owe at the end of the year, as well as a direct payment of certain other taxes.

In the History of the U.S Tax System, the U.S. Department of Treasury describes tax withholding.

The amount of a person's federal income tax withholding depends on several factors such as:
* the taxpayer's marital status.
* the number of children or dependents the taxpayer has.
* whether or not the taxpayer is an employee [ IRC 3401] .
* if the taxpayer wants to claim child tax credits.
* if the taxpayer holds two or more jobs.
* if the taxpayer plans to itemize.
* any tax exemptions from withholding that the taxpayer wants to claim.
* any additional amount the taxpayer wants to withhold.

A taxpayer will get a tax refund if the withholding for the year was greater than the income tax actually owed.

ee also

*Form W-2
*Payroll tax
*United States
*Withholding tax
*Dividend tax
*Internal Revenue Code 3401
*Taxation in the United States
*US State NonResident Withholding Tax


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