"In order to correct an overpayment of income tax or Additional Medicare Tax, an employer may make an interest-free adjustment on the appropriate corrected return, but only if the employer repays or reimburses the employee before the end of the calendar year in which the compensation was paid. In the same vein, in the event of an underpayment of income tax or Additional Medicare Tax, an employer may make an interest-free adjustment on the appropriate corrected return, but only to the extent the error is discovered within the calendar year in which the compensation was paid."  MORE >>