Waiting for the New Tax Law to Hit Your Paycheck? It Won’t Be Long Now
To say that the recently passed tax law was controversial would be an understatement. As has become a pattern in Washington over the last few years, the new tax law was passed along party lines.
In addition, recent polls show that U.S. citizens are deeply divided over whether the new law is a genuine attempt to boost the standard of living for the middle class… or just a give-a-way for the 1%.
But, regardless of what you think about the big picture surrounding this new law, you are probably wondering if and when it is going to have an impact on your own paycheck.
Here’s the deal…
The Internal Revenue Service (IRS) is hoping to give employers guidance in January regarding how much they should withhold from each paycheck. This means that you may have to wait until February to see any direct impact from the new tax law.
How Big of a Chance Are We Talking About?
Even if the changes to start to go into effect, on a practical level, in February, many employees may be surprised by how little their take home pay changes.
For example, according to Pete Isberg, VP of government relations at ADP, who spoke to Reuters, “When the taxes are reduced by 1 to 3 percent, that’s not going to be a huge noticeable difference. It’s not going to be hundreds of dollars.”
Not Everyone Will Benefit
Of course, take home pay is just part of the story. Homeowners in high-tax states such as New York or California may find their total property ownership costs increasing. This is especially concerning for our community since older adults are the largest group of property owners in the country.
In any case, it’s definitely best to talk with a financial professional to plan for how the new tax law may impact your own situation.
Still, if you are primarily concerned about when you may see a chance in your paycheck, the answer is… it should just be a few more weeks. As soon as the IRS and the companies that they work with get everything sorted out, the changes will begin to be implemented.
Do you think that the new tax law is going to have a positive impact on your life overall? Why or why not? Let’s have a chat!
Disclaimer: Nothing in this article is intended to be financial advice. Please consult a financial professional to see how the new tax law may impact you and your family.