MomWork will be a feature of the forthcoming “Your Money Mom” podcast). MomWork is a short (you should be able to complete in less than 30 minutes) money to-do to help you make progress or get more organized with your financial life.
IRS Withholding Calculator
The IRS has a very easy-to-use and basic Tax Withholding Calculator. It’s worth a look.
Because of the changes for 2018 in tax law, I advise everyone to take a few moments to fill out this calculator now. That’s in case you need to make changes. Visit the Tax Calculator in any of the links in this post.
After the tax law went into effect, some employers have automatically given you more out of every paycheck. But, that could mean a lower refund for you, or even that you owe taxes. If you take a moment to see where you stand now, there’s still time to change your withholding so you have the refund that you expect. Or can have enough taken out for taxes so you don’t owe any money.
This isn’t a post on financial strategies related to tax returns–I’ll save that for another day. Suffice to say that this topic, like many money topics, is very personal.
I know most of the personal finance literature says people should receive as little as possible in a tax refund. But I also know many people like to get a sizable check, and like to be able to earmark it for something special. In general, you should do what works for you.
But, can’t we all agree that owing taxes in April is not a good idea?
Regardless of your strategy, this calculator is totally free and takes about 10 minutes, tops, to fill out. When you’re finished, you will have a good “guesstimate” of your tax situation. Plus, you’ll have the time to change your W-2 if need be.
Let me know if you completed this MomWork and what you thought about the process and the calculator.