Withholding refers to the amount of income tax withheld from an employee’s paycheck. It is important to choose the correct withholding amount to avoid owing taxes at the end of the year or having a large refund.
There are a number of factors to consider when choosing withholding, including the employee’s income, filing status, and number of dependents. The IRS provides a withholding calculator to help employees determine the correct amount to withhold.
