Every year my tax refund keeps getting bigger. This time it’s over $5500. I’d rather have that money in my paycheck throughout the year instead of getting it all at once.
I have a fixed salary and no overtime. I know I need to adjust my W-4, but every online tool I use just tells me to take the standard deduction.
Is there a way to fill out my W-4 so I see more money each paycheck instead of waiting until tax time?
This is why I went exempt this year. Still getting around $3K back, but at least it’s better than the $7K I used to get. We were paying about $5K in taxes before. I’d rather have that money throughout the year instead of waiting for a refund. The whole system makes no sense to me.
@Avery
I wouldn’t mind just setting money aside in a savings account and writing a check at tax time. I’ve never owed anything before, so it shouldn’t be too hard to figure out how much to save. Maybe I’ll go exempt too.
I just use a spreadsheet. Every October, I estimate my taxes and adjust my W-4 by either changing dependents or adjusting extra withholding. Keeps my refund around $500 or less.
Do you get the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC)?
Yeah, I do get the ACTC.
Your W-4 should be pretty close then. Are you filing as Head of Household for the whole year? That changes the standard deduction. There’s also a spot on the W-4 where you can claim the CTC and ACTC.
Somebody already mentioned the IRS calculator. That’s probably your best bet.