The two most common methods of determining federal income tax withholding are the percentage method and the wage bracket method.

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Quizplus · Accepted Answer

This is true. The percentage method calculates withholding based on an employee's wages and the number of allowances claimed on their W-4 form, while the wage bracket method uses a table to determine withholding based on an employee's pay and filing status.

The Two Most Common Methods of Determining Federal Income Tax