A withholding tax takes a set amount of money out of an employee's paycheck and pays it to the government. The money taken is a credit against the employee's annual income tax. If too much money is withheld, an employee will receive a tax refund; if not enough is withheld, an employee will have an additional tax bill.
in some cases a taxpayer can request that withholding be taken out of certain payments like Social Security, pension and IRA distributions, Unemployment compensation payments abd certain others.
