Flash News NA 2025/04/21

IRS Adjustment in Portugal: What You Need to Know in 2025

The IRS (Personal Income Tax) adjustment is an annual process that reconciles tax withheld at source during the year with the amount dueThe IRS (Personal Income Tax) adjustment is an annual process that reconciles tax withheld at source during the year with the amount due.

In 2024, with the reduction in IRS rates and withholding levels, many taxpayers will see smaller refunds or even amounts to pay.

This article explains how the adjustment works and how NOMINAUREA can assist with the submission of IRS Form 3.

The IRS adjustment occurs because employees pay taxes in advance through withholding during the year.

In the following year, when submitting the income tax return, the final amount of tax is calculated based on income, personal and family circumstances, and applicable deductions.

If the withheld tax exceeds the amount due, the taxpayer is entitled to a refund; if it is less, there will be an amount to pay.

In 2024, the Government reduced IRS rates and applied new withholding tables so that taxpayers had more take-home pay.

This meant that less tax was withheld throughout the year, so in 2025, most refunds will be smaller, or, in some cases, there may be taxes to pay.

In practice, families benefited from having more available income in 2024, allowing better budget management or increased savings.

The IRS adjustment now reflects that reduced tax prepayment.

Conclusion

With the deadline for submitting the 2024 tax return open until June 30, 2025, it is essential to ensure timely and accurate filing.

NOMINAUREA offers specialized services to assist with the submission of IRS Form 3, ensuring an efficient process that complies with tax obligations.