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Tax withholding is the money your employer takes out of each paycheck and sends to the IRS on your behalf. The amount withheld depends on your W-4 form and how much you earn. If too little is withheld, you'll owe taxes when you file — and possibly a penalty. If too much is withheld, you'll get a refund. You can update your W-4 any time to adjust your withholding.
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