Over the weekend, the Detroit Free Press highlighted  how hardworking West Michigan taxpayers will be seeing larger paychecks because of the Republican-led tax reform. Below are excerpts from the article. Click here to read the entire piece.
“So how much extra cash will end up in your pocket now that payroll withholding tables are changing under the new federal tax law? The answer, like anything to do with taxes, is it all depends on your situation. Some middle-income taxpayers could be looking at an extra $20 or $30 a week. …
“Taxpayers should begin seeing changes in the amount of money that’s withheld for federal income taxes on their checks sometime in February. About 90% of workers should see some extra cash. …
“Under the new law, the child tax credit was doubled to $2,000 per qualifying child beginning in 2018. To claim the credit on a 2017 return, the child must have been younger than 17 at the end of last year. …
“The amount withheld toward federal income taxes depends on the number of withholding allowances that you’ve claimed, whether you’ve claimed child or dependent care expenses, if you’re single and have more than one job, or if you’re married and both spouses bring home paychecks. …
“Bonuses are subject to a different withholding rate, if supplement wages are paid in addition to your normal paycheck. But the good news is that the withholding rate on bonus checks is now 22%, not 25%, according to Greene-Lewis of TurboTax. So on a $5,000 bonus check, the withholding would be $1,100 instead of $1,250. On a $1,000 bonus check, the withholding would be $220 instead of $250.”