DECO, the Portuguese consumer defense association, issued a warning regarding workers' salaries and Christmas bonuses. Due to the reduction in IRS withholding taxes, workers will receive more money in their monthly salaries and Christmas bonuses.
However, the organization warns that receiving more money does not mean that all of this amount corresponds to a definitive reduction in tax. Part of this additional money may only be a temporary advance.
The definitive settlement with the tax authorities will only be made in 2027, when workers file their IRS declaration for the current year. At that time, there may be additional tax payments if the withholdings were lower than the actual amount owed.
This situation is due to the fact that the reductions in withholding taxes are calculated in an estimated manner and may not correspond exactly to each taxpayer's real tax situation throughout the year.
