W-4 — That's the form an employee fills out so an employer knows how much income tax money to withhold from the employee's paycheck.
And Missouri's Revenue Department wants taxpayers to review their W-4 forms with their employers to make sure the correct amount is being withheld.
Ken Zellers, the state's acting Revenue director, said in a news release: "While taxpayers should make reviewing their W-4s a regular practice, doing so this year is especially important because the department updated the MO W-4 form for employee withholding at the start of 2019.
"Due to recent tax changes at the federal level, employees can no longer increase or decrease the amount withheld from their paychecks by claiming allowances that are not consistent with their specific filing situation."
In an online posting, at dor.mo.gov/business/withhold, the department noted: "The withholding is based on the employee's wages during that pay period, and the number of dependents.
"When the employee calculates his income taxes for the year, the amount of taxes withheld helps determine whether a refund is issued to the taxpayer (more was withheld than necessary) or whether the taxpayer owes more in tax (less tax was withheld than necessary)."
But, as Zellers noted, the tax law changes make it harder to use the withholding tables alone to adjust how much money is held out of each paycheck.
The department does offer a withholding calculator on its site, mytax.mo.gov/rptp/portal/home/withholding-calculator.
The advice for an employee to review his or her withholding information is especially important this year, the department said.
It's the second year of the federal tax law changes that went into effect Jan. 1, 2018, and also affects withholdings at the state level.
And, the department noted on its website, the Legislature last year changed some of the language in the law that affects the interconnection between state and federal withholdings.
"Effective for tax year 2019, the federal income tax deduction taxpayers may claim is prorated based on the taxpayer's Missouri adjusted gross income," the Revenue Department said. "In an attempt to ease implementation of the new withholding formula, the Department of Revenue chose to remove the federal tax deduction from the withholding tax calculation."
That change means some taxpayers could see "a small increase to the amount withheld from employees' paychecks," the department said.
In a recent interview, Chuck Pierce — a certified public accountant who represents the Missouri Society of Certified Public Accountants in conversations with lawmakers — told the News Tribune: "The rates at the federal level went down, and the standard deduction also went up at the federal level.
"So, your federal tax liability may have gone down, which means you have a smaller deduction on your Missouri return, because you paid less federal taxes."
Pierce noted the withholding calculations are intended to bring a taxpayer as close as possible to paying his or her tax obligation throughout the year, so that there's no big bill — or big refund — when tax returns are filed by mid-April.
But, because each taxpayer has individual circumstances that aren't covered by employee withholdings, the tax laws allow some adjustments to be made in the W-4 withholding orders — although the new tax laws don't allow for as much flexibility as the former laws did.
The new federal W-4 form allows a taxpayer to withhold "an additional amount, if any from each paycheck," on Line 6, that would be above the amount required to be withheld by the worksheet calculations.
The new Missouri W-4 form also has that option, on Line 2, explaining: "If you expect to have a balance due (as a result of interest income, dividends, income from a part-time job, etc.) on your tax return, you may request your employer to withhold an additional amount of tax from each pay period."
Most people pay taxes for a calendar year (Jan. 1-Dec. 31), so we're already 4 1/2 months into the new tax year.
Still, Pierce said, "This time of the year is when a lot of tax planning actually occurs.
"In a perfect world, it would occur before this, but a lot of people really don't think about their taxes until they sit down with someone to have them done."
Pierce said people with complicated returns may want to consult with their CPA.
"If you're a W-2 only taxpayer, and you don't have anything else going on, the withholding tables probably are going to, in most cases, get you very, very close to your actual tax liability," he said.
"If you have these other factors going on that affect your tax liability — that the withholding tables can't take into account — then you really need to be doing something else."