WITH HOLDINGS Meaning and
Definition
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Withholdings, in the context of finance and taxation, refer to the amount of money that is deducted from an individual's income or earnings before it is paid to them. These deductions are generally made by employers or financial institutions in order to fulfill tax obligations or fulfill other legal obligations.
Withholdings primarily function as a means for regulating and ensuring compliance with tax laws and regulations. Employers typically deduct a portion of an employee's wages to cover federal or state income taxes, social security contributions, and other applicable contributions. These deducted amounts are then withheld or held back by the employer until they are remitted to the appropriate tax authority or governing body.
In addition to tax withholdings, other types of withholdings may also be deducted from an individual's earnings, such as contributions to retirement plans, health insurance premiums, or child support payments. These withholdings are deducted by employers or financial institutions as mandated by court orders, contractual agreements, or statutory requirements.
It is important for individuals to accurately report their tax and financial information to their employers or financial institutions in order to ensure that the appropriate amount of withholdings is deducted from their income. Failure to do so may result in penalties or underpayment of taxes, which can lead to financial repercussions.
Overall, withholdings serve as a mechanism to collect and allocate funds for various purposes, including taxes, contributions, and obligations, thereby facilitating compliance with legal requirements and ensuring the correct distribution of individual's income.
Common Misspellings for WITH HOLDINGS
- witholdings
- withholdings
- wythholdings
- qith holdings
- aith holdings
- sith holdings
- eith holdings
- 3ith holdings
- 2ith holdings
- wuth holdings
- wjth holdings
- wkth holdings
- woth holdings
- w9th holdings
- w8th holdings
- wirh holdings
- wifh holdings
- wigh holdings
- wiyh holdings
- wi6h holdings
Etymology of WITH HOLDINGS
The word "withholdings" is derived from the verb "withhold".
The term "withhold" dates back to Old English, where it was written as "wiþhaldan". It is a combination of the prefix "wiþ-" meaning "against" or "back" and the verb "haldan" meaning "to hold" or "to retain".
Over time, the verb "withhold" came to mean the act of holding back or retaining something, especially in terms of money or information. In the context of taxes, "withholdings" refers to the amount of money that an employer deducts from an employee's wages for income tax purposes before paying the employee. This deduction is done based on an estimation of the employee's annual tax liability.
