KDOR

TOPEKA—Withholding tables designating how much income employers should remove from employee paychecks to abide by the retroactive tax increase passed by the 2017 Kansas legislature are now available.

In order to make up for the increased tax liability almost every Kansan owes, KDOR utilized 2018 tax rates in the new withholding tables. This policy decision serves two purposes: to ensure that enough income is withheld from paychecks to catch up for the increased and backdated tax liability in the second half of the year, and also to provide certainty for Kansas employers.

“Adjusting withholding amounts is something every business–no matter how large or small—will have to do because of this new tax law,” said Revenue Secretary Sam Williams. “We made the decision that it was best to address both the retroactivity and the fact that the rates will change again January 1 within these new withholding tables.”

Although the withholding tables are designed to adjust paychecks according to law, Secretary Williams recommends individuals talk to their tax preparer to ensure the amount withheld is sufficient to meet their increased tax liability.

“There are a lot of variables with tax increases. It’s best to be prepared well in advance to ensure it doesn’t destroy your budget,” Secretary Williams said.

The new tax law also places taxes on non-wage business income. Business owners should make estimated tax payments every quarter. The new tax law does not impose penalties or interest for underpayment on both individual and non-wage business income as long as it is paid in full by April 17, 2018. However, it is advisable business owners make the quarterly payments to avoid an enormous tax bill come April.

The official notices that address the new tax law are available here.