{"id":10199,"date":"2025-02-14T22:10:53","date_gmt":"2025-02-14T22:10:53","guid":{"rendered":"https:\/\/finderica.com\/?p=10199"},"modified":"2025-02-14T22:10:53","modified_gmt":"2025-02-14T22:10:53","slug":"how-to-know-if-youre-withholding-enough-taxes-from-your-paycheck","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=10199","title":{"rendered":"How to know if you’re withholding enough taxes from your paycheck"},"content":{"rendered":"
<\/span><\/p>\n
\n
\n
\n

Prapass Pulsub | Moment | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n

\n

If you have a tax bill or bigger than expected refund this season, it may be time to update your paycheck withholding, which can be tricky, experts say.\u00a0\u00a0<\/p>\n

Typically, there’s a refund when you overpay taxes throughout the year, and a tax bill when you don’t pay enough. It’s up to the employee to tell employers how much federal tax to withhold from each paycheck via Form W-4<\/a>.\u00a0<\/p>\n

The form “seems like a calculus problem,” said Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida. But there’s a “quick and dirty” way to figure it out, he said.<\/p>\n

More from Personal Finance:<\/strong>
You could see tax Form 1099-K for the first time this season
Credit card debt hits record $1.21 trillion, Fed research shows
Americans to spend a record $14.6 billion on Valentine’s Day<\/p>\n<\/div>\n

<\/a>‘Back-of-the-napkin’ math for your withholding<\/h2>\n
\n

After filing your 2024 return, you can see your “total tax” on line 24 on the second page of your filing, Form 1040<\/a>, Lucas said. If your earnings and tax situation are the same for 2025, your tax liability should be similar.<\/p>\n

Next, you’ll need to know how much you’re withholding from each paycheck and how many pay periods remain for 2025 to see if you’re on track, he explained.<\/p>\n

For example, let’s say your “total tax” was $10,000 for 2024. If there are 23 pay periods left in 2025, you’ll need to withhold roughly $435 from each paycheck, Lucas said.<\/p>\n

To withhold more, you can resubmit Form W-4 with an “extra withholding” added in the “other adjustments” section of step 4, he said.<\/p>\n

“That’s the simple, back-of-the-napkin method,” Lucas said.<\/p>\n

However, you’ll need to readjust your W-4 at the beginning of the next tax year. It should also be updated as your tax situation changes \u2014 like a bonus, second job, marriage, divorce, having a child and more.<\/p>\n<\/div>\n

<\/a>Use the IRS ‘tax withholding estimator’<\/h2>\n
\n

If your tax situation has changed or you want a more detailed update, you can use a free IRS tool<\/a> known as the “tax withholding estimator,” Lucas said.<\/p>\n

“It’s intuitive and it actually does a really good job,” he said.<\/p>\n

You’ll also need pay stubs from all jobs (including your spouse) and most recent tax returns. But it won’t be a good fit “if your tax situation is complex,” according to the IRS.<\/p>\n

With rapid changes in income, investment earnings or retirement plan distributions, you may need quarterly estimated tax payments to avoid IRS penalties, said Sheneya Wilson, a certified public accountant and founder of Fola Financial in New York.\u00a0<\/p>\n<\/div>\n

\n
\n
\n
\n
<\/span><\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Prapass Pulsub | Moment | Getty Images If you have a tax bill or bigger than expected refund this season, it may be time to update your paycheck withholding, which can be tricky, experts say.\u00a0\u00a0 Typically, there’s a refund when you overpay taxes throughout the year, and a tax bill when you don’t pay enough.<\/p>\n","protected":false},"author":1,"featured_media":10200,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"categories":[196],"tags":[1238,315,3102,422],"class_list":{"0":"post-10199","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-finance-news","8":"tag-paycheck","9":"tag-taxes","10":"tag-withholding","11":"tag-youre"},"_links":{"self":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts\/10199","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10199"}],"version-history":[{"count":0,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts\/10199\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/media\/10200"}],"wp:attachment":[{"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10199"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10199"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10199"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}