The IRS has a message for retirees: make sure you’re paying enough federal income tax. The Tax Cuts and Jobs Act of last December changed the income tax calculations for most filers, and employees aren’t the only ones who need to double check they’re withholding the right amount.
The GOP tax bill lowered the top individual rate to 37% from 39.6%, and the income brackets dropped slightly -– by about 3%, says Chris Baker, a certified financial planner at Oaktree Financial Advisors in Carmel, Indiana. This means that on average most retirees will likely see a decrease in tax liability and owe slightly less, although it varies by individual circumstances, he says.
Read more: Every Retiree Should Make This Tax Move Right Now, According to a New Warning From the IRS