How can an incorrect federal tax withholding rate be identified on an LES?

• A. It will show unreasonable withholding amounts; verify W-4 data and recalibrate if necessary.
• B. It will be flagged automatically by the DFAS system.
• C. It can be identified only during annual tax filing.
• D. It will never appear on an LES.

Answer: (A)

Federal tax withholding on the LES is driven by the W-4 data on file, so an incorrect rate shows up as withholding that doesn’t match your pay and tax situation. The clearest way to catch it is to look for unreasonable federal tax withholding amounts on the LES. If the amount withheld seems too high or too low for your gross pay, allowances, and filing status, that indicates the withholding rate may be wrong. To fix it, verify the W-4 data on file (marital status, number of allowances, any additional withholding), recalculate what should be withheld, and have payroll adjust the W-4 and reissue the LES with the corrected amount. While automatic DFAS flags or catching this at tax time can occur, the direct indicator on the LES is the presence of an unreasonable withholding amount.