Do you know how to read the IRS withholding tables? – IRS

As IRS withholding tables determine the portion of gross salary or pension that paying entities deliver to the State, every month, to advance the tax.

When it comes time to submit the IRS declaration, withholding taxes are taken into account when the Tax and Customs Authority settles the tax. After doing the math, there may be a refund or additional tax to be paid by taxpayers.
On July 1, 2023, a new withholding tax model came into force. The model follows a marginal tax rate logic, in harmony with the IRS rangeswith installments to be deducted, so that, in practice, an increase in gross salary always corresponds to an improvement in net monthly salary.
And how do you calculate withholding tax for 2025? First, taxpayers must identify the withholding tax table that corresponds to your situation. To do this, you must check the tax address (mainland, Azores or Madeira), marital status, the number of members of the couple with income, the number of dependents and whether there is a relevant tax deficiency.

After finding the table, in the left column you should find the gross monthly remuneration scale. In this line, you will then find the maximum marginal rate, the portion to be deducted, the additional portion to be deducted per dependent and the effective monthly withholding rate at the limit of the range.

Next, let’s go to accounts for calculate withholding tax. So, first you need to multiply the maximum marginal rate
for the gross monthly salary and then subtract the portion to be deducted and the additional portion to be deducted per dependent. If there is more than one dependent, this additional portion must be multiplied.
Shall we look at examples? In the four examples we will from a gross monthly salary up to 1,787 euros.

Thus, a single who earns up to €1,787 euros must multiply this amount by 25% and deduct only a portion of €188.90 (€1,787 x 25% – €188.90 = €257,85)

Already one single with a dependent do the same calculations but deduct an additional installment of €34.29 (€1,787 x 25% – €188.90 – 34.29 = €223.56).

If it is a couple with two holders and one dependentthe portion to be deducted is lower, at €21.43 (€1,787 x 25% – €188.90 – €21.43 = €236.42).

And in the case of a couple with two holders and two children you must multiply the portion relating to dependents (€1,787 x 25% – €188.90 – €42.86 = €214.99).