Are you Withholding Enough for Taxes?

The SECURE Act enacted on Dec. 20, 2019 affects some individual tax returns that taxpayers will file for 2020. This primarily affects taxpayers who claim:

• the itemized deduction for mortgage insurance, if they pay mortgage insurance premiums (the SECURE Act treats mortgage insurance premiums as qualified residence interest for itemized deduction purposes in 2019 and 2020).
• the itemized deduction for medical and dental expenses (one of the SECURE Act provisions is the ability to deduct unreimbursed expenses that exceed 7.5% of adjusted gross income in 2019 and 2020).

We recommend clients work with their accountant to determine the amount you should be withholding from your paycheck.  For those do-it-yourselfers, the IRS introduced a new, more accurate, tax withholding estimator calculator:  https://www.irs.gov/individuals/tax-withholding-estimator.