If you have too little withheld from your pay check, you could end up owing money when you file your taxes. If you withhold too much, you get a large refund, BUT you have let the government have too much of your money all year.
The IRS has a withholding calculator at IRS.gov to help you figure the correct amount of federal withholding for your tax situation. If you find you are over or under withholding, you should fill out a new W-4 Form with your employer and have the withholding adjusted.
To use the withholding calculator have this information available:
*Your most recent pay stub
* Your most recent federal tax return
*Fill in all information that applies and print the screen that summarizes your information. Use this information to complete a new W-4 Form.
This tip brought to you by Schutte & Hilgendorf, CPA’s, a Prescott firm serving the greater Yavapai County, providing audit, accounting, bookkeeping, tax preparation and planning, Quickbooks accounting and setup to individuals and small businesses.
Contact us for a free initial consultation at 928-778-0079.