What is Withholding Allowances? | Meaning & Definition | Akrivia HCM

Withholdings allowances is a financial term used to describe the money allocated by an employer for taxes. It can be calculated either on a quarterly or an annual basis and distributed through these intervals. Employers withhold certain federal taxes from their employee’s paychecks and report the payments to the Internal Revenue Service (IRS). These withholding allowances are based on income, as determined by the IRS code.

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