Updated 2018 Withholding Tables Available

The IRS released Notice 1036 on January 11th, updating the income tax withholding tables for 2018 to reflect changes made by the recent tax law passage.

In the recent news release, the IRS states:

Employers should begin using the 2018 withholding tables as soon as possible, but not later than Feb. 15, 2018. They should continue to use the 2017 withholding tables until implementing the 2018 withholding tables.

The new withholding tables are designed to work with the Forms W-4 that workers have already filed with their employers to claim withholding allowances. This will minimize burden on taxpayers and employers. Employees do not have to do anything at this time.

The new tables reflect the increase in the standard deduction, repeal of personal exemptions and changes in tax rates and brackets.

To help people determine their withholding, the IRS is revising the withholding tax calculator on IRS.gov. The IRS anticipates this calculator should be available by the end of February. Taxpayers are encouraged to use the calculator to adjust their withholding once it is released.

The IRS is also working on revising the Form W-4. The calculator and new Form W-4 can be used by employees who wish to update their withholding in response to the new law or changes in their personal circumstances in 2018, and by workers starting a new job. Until a new Form W-4 is issued, employees and employers should continue to use the 2017 Form W-4.

For the full news release: Updated 2018 Withholding Tables Now Available; Taxpayers Could See Paycheck Changes by February | Internal Revenue Service

IRS Extends Due Date to Issue Health Coverage Forms to Individuals

Yet again, the IRS has extended the deadline for “insurers, self-insuring employers, other coverage providers, and applicable large employers to send out 1095 forms to individuals.”

They now have until March 2, 2018, to provide Forms 1095-B or 1095-C to individuals, which is a 30-day extension from the original due date of Jan. 31… This 30-day extension is automatic. Employers and providers don’t have to request it.

For individual taxpayers and the accountants that prepare their returns, this is pretty frustrating news. Those responsible for providing health insurance (insurance companies, self-insuring employers, and applicable large employers, etc.) are required by the ACA to furnish statements to employees and other covered individuals regarding the health care coverage offered to them. Individuals use this information to determine whether, for each month of the calendar year, they may claim the premium tax credit on their individual income tax returns.

Because accountants are required by law to confirm with their clients that they had insurance that meets the requirements of the mandate, not having Form 1095 in-time to prepare 2017 tax returns is a challenge. Therefore, the IRS has provided guidance indicating that other sources can be used to confirm coverage — such as insurance cards or bills — but obviously those documents don’t provide information on which months the taxpayer may not have had coverage, so relying on them or on a taxpayer’s memory of which months they are covered can be a costly mistake.

Source: IRS Extends Due Date for Employers and Providers to Issue Health Coverage Forms to Individuals in 2018 | Internal Revenue Service

2018 Tax Season Begins Jan 29; Tax Returns Due Apr 17

Big news — The IRS has finally announced the day they will begin accepting e-files: January 29th. And Tax Day is April 17th — making it a shorter-than-usual season, based on the number of days in-between.

Therefore, we encourage getting your books and tax prep docs together ahead-of-time, making fourth-quarter estimates based on these reconciled books, and getting in-line with your tax preparer asap, so as to avoid any bottlenecks. Your tax accountant can prepare your return ahead of the due date and simply check for new form updates the day filing opens — then your return will be one of the first in the queue.

More here: 2018 Tax Filing Season Begins Jan. 29, Tax Returns Due April 17; Help Available for Taxpayers | Internal Revenue Service