Over the course of the year, you paid more federal income tax than you owed. In other words, you gave Uncle Sam an interest-free loan. If you'd rather have a fatter paycheck and a smaller refund, you can control this.
All you have to do is submit a new Form W-4 to your employer to adjust your federal income tax withholding. If you received a tax refund last year, you aren't alone. In fact, you're in the majority. According to the IRS, almost million tax filers received refunds in Or, in other words, about seven out of every 10 returns resulted in a refund.
If getting your refund throughout the year rather than at tax time sounds appealing, you can adjust your withholding today.
To do so, you'll need to fill out a new Form W-4 and submit it to your employer. This form requires you to fill in a few sections depending on your situation. The more accurately you complete the form, the more precise your withholding should be. Tools, such as withholding tax calculators, can help you figure out what to fill in on the various steps of Form W You'll have to answer questions about your tax situation before the calculator will tell you how to fill out your Form W Tax withholding calculators , such as the one TurboTax offers, help you get a big picture view of your refund situation by asking detailed questions.
You'll need to provide information like your. If you're stuck on any question, TurboTax will provide more details about what exactly you're looking for so you can input the right information.
Based on the results, you can determine if making adjustments to your withholding to lower your refund and get a bigger paycheck is the right move for you. If you normally look forward to getting a bigger refund after you file your taxes, there's a fairly simple adjustment you can make. To figure out how much you should add, first think about how much of a refund you'd like to see after taxes.
This includes anyone who receives a pension or annuity. Wages paid, along with any amounts withheld, are reflected on the Form W-2, Wage and Tax Statement , the employee receives at the end of the year. Note: Employees must specify a filing status and their number of withholding allowances on Form W—4. They cannot specify only a dollar amount of withholding. By changing withholding now, taxpayers can get the refund they want next year.
For those who owe, boosting tax withholding in is the best way to head off a tax bill next year. Written by. Barbara Whelehan is a contributing writer for Bankrate. Barbara writes about a range of subjects, including homebuying, real estate, retirement, taxes and banking. Edited By Lance Davis. Edited by. Lance Davis. Lance Davis is the senior editorial director for Bankrate.
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About our review board. You may also like This was the average tax refund last filing season. Standard deduction amount for How much it is and when to take it. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money. Most people cross paths with a W-4 form, but not everybody realizes how much power Form W-4 has over their tax bill. Here's what the form is used for, how to fill it out and how it can make your tax life better.
A W-4 form, formally titled "Employee's Withholding Certificate," is an IRS form employees use to tell employers how much tax to withhold from each paycheck.
Employers use the W-4 to calculate certain payroll taxes and remit the taxes to the IRS and the state on behalf of employees. You do not have to fill out the new W-4 form if you already have one on file with your employer. You also don't have to fill out a new W-4 every year.
If you start a new job or want to adjust your withholdings at your existing job, though, you'll likely need to fill out the new W Either way, it's a great excuse to review your withholdings. In the past, employees could claim allowances on their W-4 to lower the amount of federal income tax withheld from their wages. The more withholding allowances an employee claimed, the less their employer would withhold from their paychecks. However, the Tax Cuts and Jobs Act overhauled a lot of tax rules, including doing away with personal exemptions.
That prompted the IRS to change the W-4 form. The new W-4, introduced in , still asks for basic personal information but no longer asks for a number of allowances. Now, employees who want to lower their tax withholding must claim dependents or use a deductions worksheet. Form W-4 is available on the IRS website. Here's how to complete the steps that apply to your situation. Enter your name, address, Social Security number and tax-filing status.
If you have more than one job, or you file jointly and your spouse works, follow the instructions below to get more accurate withholding. You typically have to have a W-4 on file for each job. Leave those steps blank on the W-4s for the other jobs. The trick: Both spouses need to do that on each of their W-4s.
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