My 2018 tax is 7000$ less than 2017 but I still owe about 500$ in federal and state taxes. Did not change W4 and always got money back before. Why do I owe this year?

[HelenaC]

If you did not update your payroll W-4 Withholding form for the new lower tax rates due to the Tax Cuts and Jobs Act  (TCJA), you probably didn't have enough federal income tax withheld from your paychecks. 

• Instead of a refund, you got more money in your paychecks.
• If you compare your federal income tax that the government kept (not what you paid in), I bet you're tax liability (federal income tax that the government keeps) is less dollar for dollar in 2018 versus 2017. 

We still have 7 federal tax brackets (same as 2017), but most taxpayers will get a lower tax bracket when compared to 2017.