Update on Impact of Federal Tax Reform
Faculty and Staff,
With recent passage of the 2017 Tax Cuts & Jobs Act, we are providing an update on when you can expect to see the changes on your paychecks. The IRS is still working on revising withholding forms and tax tables related to the new tax rates and expects to release them later this month. Until the IRS releases the new withholding tables, the IRS has directed employers to keep using 2017 withholding rates in employee checks. Below is the latest communication posted on the IRS website:
December 26, 2017
The IRS is working to develop withholding guidance to implement the tax reform bill signed into law on December 22. We anticipate issuing the initial withholding guidance in January, and employers and payroll service providers will be encouraged to implement the changes in February. The IRS emphasizes this information will be designed to work with the existing Forms W-4 that employees have already filed, and no further action by taxpayers is needed at this time.
Use of the new 2018 withholding guidelines will allow taxpayers to begin seeing the changes in their paychecks as early as February. In the meantime, employers and payroll service providers should continue to use the existing 2017 withholding tables and systems.
Employee checks for January will therefore reflect 2017 withholding rates.
For more details on the new tax law, please see article at the following link:
You may also contact a tax professional about how tax reform may impact you personally.
We will provide further updates as additional information becomes available. Please contact Payroll Services at 859-257-3946 if you have questions.
Eric N. Monday
Executive Vice President for Finance & Administration