Audits and tax notices

Withholding Compliance

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IRS Definition

The IRS may direct your employer to withhold federal income tax at an increased rate to ensure you have adequate withholding.

More from H&R Block

When you complete a Form W-4, if you claim more exemptions than you are entitled to, or you mark that you are exempt from having taxes withheld from your pay check and you are not exempt, the IRS can force your employer to withhold taxes at a higher rate. This typically only happens if you owe a significant amount of tax due to underwithholding for more than one year.

You should plan to have enough withheld from your pay check so that you do not owe at the end of each tax year. Underwithholding can lead to owing taxes to the IRS. Learn how to address an unpaid tax bill.

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