What is FITW tax on my paycheck?

[accountinglads]

Fitw Tax is the acronym used to refer to Federal Income Tax Withholding which is the amount your employer deduces off your paycheck and remits to the IRS on your behalf. This will be withheld on your estimated federal income tax due in the year. This is based on your income, filing status and any adjustments that you made on your W-4 form. When you submit your tax filing, the amount you owed in tax is compared to the amount that was withheld, in case it was over withheld you receive a refund of your tax, and in case it was under the limit, you have to pay the difference. FITW makes the payment of taxes gradual all through the year.