26 U.S.C. § 31 — Tax withheld on wages

(a) Wage withholding for income tax purposes: (1) In general: Any tax withheld from your wages under chapter 24 counts as a credit against your income tax. This lowers what you owe. (2) Year of credit: You claim this credit for the tax year that begins in the same calendar year the money was withheld. If more than one of your tax years starts in that calendar year, you claim the credit in the last one that starts. (b) Credit for special refunds of social security tax: (1) In general: The Secretary can write regulations letting you credit, against your income tax, a special social security refund amount you or the Secretary calculated under section 6413(c). Under those regulations, this amount counts as though it were tax withheld from your wages under section 3402. (2) Year of credit: Just like in subsection (a), you claim this credit for the tax year beginning in the calendar year you received the wages. If more than one tax year starts in that calendar year, you use the last one. (c) Special rule for backup withholding: If tax was taken from your income under the "backup withholding" rules in section 3406, you can claim that as a credit under subsection (a). You claim it for the tax year in which you actually received the income.