The state will take a little less out of your paycheck beginning in April. Iowa Department of Revenue spokeswoman Renee Mulvey says they’re making another adjustment of the tax withholding tables. She says they determined a couple of years ago that the state was taking too much out of Iowan’s paychecks. Mulvey says they made a reduction in the withholding tables last year and this year they’re making one more reduction.
Mulvey says this will prevent the state from collecting too much money, and then having to turn around and give it back in a rebate. She says you should look at your refund this year and you might see a reduction after they reduced the withholding last year. Mulvey says if you’re still getting a big refund, you might want to adjust your W-4 withholding form, so less is taken out of your check.
Mulvey says the adjustment to the withholding isn’t going to leave you with a lot of extra money. She says it might only be one dollar, in another case it could be seven dollars. Mulvey says you add up the difference over the entire year and compare that to your refund and you can see the difference. Mulvey says the ideal is to take enough out of each check during the year so you don’t have to pay any extra tax at the end of the year, or so that you don’t get a large amount of money back in a refund.
Mulvey says the tax rates aren’t changing, just the way the state collects the taxes that’re due. The new tax withholding changes take effect April 1st. Mulvey says employers and taxpayers who have questions should call Taxpayer Services at 1-800-367-3388 to talk to a tax specialist, who may also be reached by e-mail at [email protected].