The Making Work Pay Tax Credit Could Make You Owe More Next Tax Year

June 29, 2009 - PRLog -- The Making Work Pay Tax Credit was included in the American Recovery and Reinvestment Act signed into law by President Obama back in February. The credit is a maximum $400 cut in payroll tax, which is received in small increments every paycheck. The result is larger paychecks. This may seem like a good thing, but you have to watch your withholdings. The changes could result in less tax being withheld than you would prefer, leading to lower tax returns and higher tax payments next tax season.

According to Ronnie Hicks, Senior Tax Attorney at Tax Defense Network, those who should pay particular attention to their withholding include:'

•  Pensioners
•  Married couples with two incomes
•  Individuals with multiple jobs
•  Dependents
•  Some social security recipients who work
•  Workers without valid Social Security Numbers

“If you feel like you’ll end up owing by the end of year, you’re not really saving,” says Ronnie Hicks, Senior Tax Attorney at Tax Defense Network. “If necessary, make adjustments by filing a revised form W-4.”

But how do you know if you need to make an adjustment? Access the IRS Withholding Calculator by going to irs.gov and typing “IRS Withholding Calculator” into the search bar.

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Tax Defense Network has been helping taxpayers with their IRS Tax Debt Issues for 10 years. Tax Defense Network has the highest BBB rating and is composed of Tax Attorneys, CPAs, and even former Revenue Officers.