Perhaps a bit more detail would be helpful. However, if you are referring to the difference between 2020 and 2021 federal withholding on your W-2 Form, it can be for various reasons.
The IRS does adjust the withholding tables each year and a new Form W-4 was created to help with the Advanced Child Tax Credit in 2021.
If you have children, you will likely be affected by this. The advance amount will be used to reduce the full amount of the child tax credit you are entitled to. The balance will be included to reduce your tax liability or increase your refund.
There are two ways to get the right amount:
- Check IRS Form 6419, included with the IRS letter mailed January 2022
Both methods will give you an accurate amount that matches IRS records. Entering an estimate or an amount that doesn’t match IRS records will cause problems and delays when the IRS goes to process your return.
Please clarify with additional details if necessary.
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