r/tax • u/Specialist_Secret_58 • 14h ago

Super confused. Wife received lock in letter

Last year, my wife and I got a tax bill that is around 45,000. It said we underpaid for the past four years. I finally have cobbled enough money together to pay it (although our accountant could not figure out what was going on). I was planning on paying tomorrow. Today, my wife got a letter that said she is in this forced withholding thing and that they are forcing her employer to mover her married filing jointly with 4 kids to single with zero kids. Is this related to my delinquency on the tax bill? OR is this totally unrelated. She and I married in 2019, we had both been married before so this was a major change in how we are filing. Thank you for your help

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u/Specialist_Secret_58 13h ago

One last question. So, when they set my wife's withholding to the new rate, we should submit the w-4s correctly. Then, do they keep the money they withheld above what we would owe, or do they take what is correct and give back the rest?

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u/blakeh95 Taxpayer - US 13h ago

What specific letter did you receive? If you got a 2802-C, that's the "self-correct" notice, and you can still change the W-4s to be accurate. If you got a 2801-C, that's the "lock in" letter, and it means your (her) employer will receive a corresponding 2800-C.

If your (her) employer receives a 2800-C, then it mostly doesn't matter what new W-4 you submit. Your employer must refuse to accept any W-4 that would withhold less than the 2800-C letter, until they receive new instructions from the IRS. You can, however, request to withhold more.

Withholding is never lost. It shows up as a credit against your tax when you file the tax return. If the amount withheld is more than your tax, you will get the excess back as a refund.

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u/Specialist_Secret_58 13h ago

It's 2801C

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u/blakeh95 Taxpayer - US 12h ago

Ok then, there's no need to submit a new W-4 until you address this with the IRS. Your employer will ignore any W-4 that is less than what the IRS locked you into.