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A method for paying taxes in which a company holds back enough money from an employee's compensation to cover the taxes that the employee owes on it. The company then deposits the taxes directly with the IRS and (if applicable) the state and/or local tax authorities. In equity compensation, the timing and methods of withholding (and the rules of whether withholding is even required) vary by stock grant and type of employee stock purchase plan. See the Tax Center for details.

If not enough is withheld, or if withholding is not required, you may need to make estimated tax payments.

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