Employers should start using the 2018 withholding tables as soon as possible, "but not later than February 15", the Internal Revenue Service said in a news release (IR-2018-05).
"The time it will take for employees to see the changes in their paychecks will vary depending on how quickly the new tables are implemented by their employers and how often they are paid - generally weekly, biweekly or monthly", the IRS writes online.
Individual taxpayers aren't required to make any changes right now.
The W-4 is the form you filled out when you started your job in which you indicated the federal income tax you wanted withheld from your paycheck.
To help people determine their withholding, the IRS is revising the withholding tax calculator on IRS.gov.
The IRS is not issuing new Form W-4s ... yet. Meanwhile, tax professionals say there are some other things you need to do now to get ready for tax season next year.
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The amount of one withholding allowance on an annual basis increased to $4,150 in 2018 from $4,050 in 2017, the IRS said. Personal exemptions are a core feature of the current withholding system, but now that they are eliminated, "it's necessary to build a new approach to withholding, which will take some time", the senior IRS official said.
The updated withholding information, posted today on IRS.gov, shows the new rates for employers to use during 2018. The IRS anticipates this calculator should be available by the end of February.
But the taxing service did note that the new tax rates will require a new approach to the W-4 forms and that it should have the new forms by 2019. President Donald Trump and the Republican architects of the tax plan have deflected criticism of the unpopular legislation, insisting at every turn that Americans will come to love the new law when they see their heftier paychecks next month - with less money withheld in anticipation of lower income taxes. Still, government officials warned employees to re-assess their own withholding to avoid upsetting their personal tax plans. Two Democratic lawyers asked the watchdog Government Accountability Office to review the guidelines.
Treasury released a brief one-page analysis of the plan on December 11, claiming the proposal would increase tax revenue by about $1.8 trillion over 10 years.
The GAO is reviewing Wyden and Neal's request, agency spokesman Charles Young said in a January 11 email.