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Thread: Was there a reduction in Federal withholding rates for March?

  1. #1
    Join Date
    Jan 2014
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    10

    Default Was there a reduction in Federal withholding rates for March?

    I pay my wife once a month. The net pay for March 2021 is higher than for either January or February 2021, with a reduction in federal withholding.

    I've crawled my settings to see if I inadvertently changed anything to no avail. Did anyone else notice a reduction in Federal withholding for March?

  2. #2
    Join Date
    Aug 2002
    Posts
    2,791

    Default

    Yes, if you have the recent Tax Update from yesterday see this update description:

    https://zpay.com/vbulletin/showthrea...-March-13-2021

    Your wife will get a bonus at the end of the year when you file your taxes.
    Paul Mayer
    ZPAY Payroll Systems, Inc.

  3. #3
    Join Date
    Jan 2014
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    Default

    Thank you, Paul.

    I want to tell you how much we appreciate both the program and your support. Both are excellent!

  4. #4
    Join Date
    Aug 2002
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    2,791

    Default

    You are so very welcome!
    Paul Mayer
    ZPAY Payroll Systems, Inc.

  5. #5
    Join Date
    Jan 2003
    Posts
    14

    Default Federal Withholding

    Quote Originally Posted by echelon3 View Post
    I pay my wife once a month. The net pay for March 2021 is higher than for either January or February 2021, with a reduction in federal withholding.

    I've crawled my settings to see if I inadvertently changed anything to no avail. Did anyone else notice a reduction in Federal withholding for March?
    I noticed the same thing. All of my employees had significant amount of federal tax that was not withheld like the first two months of 2021

  6. #6
    Join Date
    Jan 2003
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    14

    Default

    So the employees will see a net increase in the their checks as the result of the tax table change on March 13. How will they receive a bonus at the end of the year when they are having less federal tax withheld? Won't that cause them to have to pay when they file their taxes next year instead of getting a refund?

  7. #7
    Join Date
    Aug 2002
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    2,791

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    Quote Originally Posted by Wendell Lenhart View Post
    So the employees will see a net increase in the their checks as the result of the tax table change on March 13. How will they receive a bonus at the end of the year when they are having less federal tax withheld? Won't that cause them to have to pay when they file their taxes next year instead of getting a refund?
    The bonus is the preview tables were deducting too much FIT that they will get back when they file their taxes at the end of the year Wendell.
    Paul Mayer
    ZPAY Payroll Systems, Inc.

  8. #8
    Join Date
    Jan 2017
    Posts
    9

    Default

    This is where I hate not knowing everything

    How can I confirm I am withholding enough? As an example, on a $500/wk paycheck, i withheld roughly $45 in Federal for the past years and first two months of this year. Now its roughly cut in half. I hadn't heard of any tax cut that reduces withholdings (my ignorance). I would hate to get to the end of the year and find that I didn't withhold enough and then I have to cover any shortfalls for all my employees.

  9. #9
    Join Date
    Aug 2002
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    2,791

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    Please see the tax update notice at this link:

    https://zpay.com/vbulletin/showthrea...-March-13-2021

    Then since you don't trust the numbers::

    Download Publication 15-T from the IRS Website and you can confirm the amounts.
    Paul Mayer
    ZPAY Payroll Systems, Inc.

  10. #10
    Join Date
    Mar 2021
    Posts
    3

    Default

    Hi Paul, I'm new to this. Could you please post the 15-T with the basis for the 3/13/21 withholding update? I cannot find it on the IRS website. All I see is a 15-T that supports the pre 3/13 withholding rates. Thank you for your help.

    BenH

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