IRS issues notice for millions of Americans – They must do this before the end of the year

Payroll taxes are paid by almost all workers. One thing that all people with jobs have in common is this. It’s a different question to ask how much you pay in taxes. This is why you need to know exactly how much of your monthly income you need to set aside to pay the IRS.

Taxes have to be paid no matter what, so many people choose to change how much they pay throughout the year to avoid unpleasant surprises when the 2024 tax campaign starts.

Having to deal with a hit of a few hundred or even a few thousand dollars all at once when you file your tax return is much worse than having to pay a few more dollars every month.

Even though it seems like the new year is still a long way off, it is already December, which means that if you want to change how much you pay in taxes, it is almost too late.

It’s too late to do that for 2024, but the same things will happen in 2025, especially if you are underpaying. That’s why now is the time to talk to your boss about how much you are paying in taxes.

How to calculate how much in taxes you owe the IRS

The Tax Withholding Estimator is a tool on IRS.gov that helps people make sure that all of their withholdings are correct.

According to a statement they put out, “This tool is especially useful for people who owed taxes or got big refunds last year, as well as for people whose lives have changed, like getting married, divorced, or having a child.”

You can use the tool to figure out how much federal income tax should be withheld, get an idea of how your refunds, take-home pay, or taxes due will be affected by the amount withheld, or pick an estimated amount that works for you.

Because federal income taxes are taken out of every pay cheque in different amounts, it’s hard to remember exactly how much you need to pay.

While your company should be able to give you a good estimate, some may have chosen to give you a higher salary during the year and make you pay a big fine when tax time comes around.

The federal income tax system is based on tax brackets. The IRS says, “The tax rate on the next level of your income is higher as your income goes up.” You don’t pay the higher rate on all of your income when your income goes up to a higher tax bracket.

“Only the part that is in the new tax bracket does it cost you more.” This is what can make them hard to figure out.

These are the tax brackets for 2024: