What is Under Withholding?
Definition of Under-Withholding
If an individual, during the year, has inadequate withholding of taxes from wages or other income, it will result in a balance due upon filing.
Explanation of under-Withholding
If there are substantial interests and penalties pending towards taxpayer, significant under withholding can result are serious and revolting surprises for the taxpayer. To avoid such situations it is recommended to over withhold taxes so that there is no financial burden.