With the Internal Revenue Service (IRS) releasing updated tax withholding tables for 2018 on Thursday afternoon in response to the Tax Cuts and Jobs Act, Paychex, Inc., a provider of human capital management (HCM) solutions for payroll, HR, retirement, and insurance services, announced it had updated its HCM platform, Paychex Flex, by the start of business Friday morning to reflect the new withholding rates.
“The updated tables are now here and for Paychex Flex clients submitting payroll today, those payrolls will be processed using the new withholdings,” said Martin Mucci, president and CEO of Paychex. “We’re proud of the leadership role we’ve taken in the payroll industry to be among the first to implement these changes, and we look forward to measuring the impact of take-home pay changes as part of our ongoing Small Business Employment Watch research.”
Updated 2018 IRS Withholding Guidance
IRS Notice 1036, the just-released guidance, instructs employers how to appropriately withhold wages from their employees’ paychecks in 2018. The new tables reflect the increase in the standard deduction, repeal of personal exemptions, and changes in tax rates and brackets. The IRS notes that the tables are designed to produce the correct amount of tax withholding for those with more straightforward situations. Taxpayers with more complex circumstances, such as itemized deductions, dependents or multiple jobs, may want to adjust their withholding. The IRS expects to release an updated withholding tax calculator to assist taxpayers by the end of February.
How Paychex Can Help
For a complete overview of tax reform, including information on the updated 2018 IRS withholding guidance, visit our tax reform resource center at www.paychex.com/articles/compliance/tax-reform.
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