A Mid Year Adjustment Can Prevent a Tax-Time Surprise When it comes to filing a federal tax return. Many people discover that they either get a larger refund or owe more tax than they expected. But this type of tax surprise doesn’t have to happen to you. One way to prevent it is to change the amount of tax withheld from your wages. You can also change the amount of estimated tax you pay.
Here are some tips to help you bring the amount of tax that you pay in during the year closer to what you’ll actually owe:
- New Job. When you start a new job, you must fill out a Form W-4, Employee’s Withholding Allowance Certificate. Your employer will use the form to figure the amount of federal income tax to withhold from your pay. Call us at 702-564-1040 or make an appointment online with any questions.
- Estimated Tax. If you get income that’s not subject to withholding you may need to pay estimated tax. This may include income such as self-employment, interest, dividends or rent. If you expect to owe a thousand dollars or more in tax, and meet other conditions, you may need to pay this tax. You normally pay it four times a year. We can calculate this for you if you call 702-564-1040 or make an appointment online at www.5641040.com.
- Life Events. Make sure you change your Form W-4 or change the amount of estimated tax you pay when certain life events take place. A change in your marital status, the birth of a child or buying a new home can change the amount of taxes you owe. Call us to see what new tax laws and changes you make in your life can lower your tax bill. You can reach us at 702-564-1040 or make an appointment online at www.5641040.com.
- Changes in Circumstances. If you receive advance payment of the premium tax credit in 2014 it is important that you report changes in circumstances, such as changes in your income or family size, to your Health Insurance Marketplace. You should also notify the Marketplace when you move out of the area covered by your current Marketplace plan. Advance payments of the premium tax credit provide financial assistance to help you pay for the insurance you buy through the Health Insurance Marketplace. Reporting changes will help you get the proper type and amount of financial assistance so you can avoid getting too much or too little in advance. If at anytime you want some up to date tax advice feel free to call us at 702-564-1040 look online for tax tips articles or make an appointment at www.5641040.com.