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I am starting a new job in a new state soon. I always get a huge refund when I file my federal taxes. I want to fill out my w4 so I break even or even owe a bit.
I plan to speak to a tax professional but do I need my first pay stub before I see them? Or will they be able to help me filling out my initial w4 on my first day at work?
Any other tips to get close to breaking even? I can't really use too much from last years return since it's a new job in a new state with a new income.
let's say you got 8k in refunds last year! Divide by 26 (if you get paid once every two weeks) = $307
then increase your W4 one at a time (or two at a time) until your paycheck is increased by about 307 bucks every two weeks.
I would suggest you do the following, given that you can change your W-4, as needed, anytime during the year.
Fill out your first W-4 using the instructions on the form. You can read/print a W-4 from this IRS webpage. http://www.irs.gov/pub/irs-pdf/fw4.pdf
After a month or two of paychecks, go to the IRS's on-line Withholding Calculator at IRS Withholding Calculator
Enter your information and it will tell you, almost to the penny, what you might need to change to "break even". Also you should run the Calculator at anytime during the year if there are changes in your pay, etc; or just to confirm if you are on track to break even.
BTW, for those who like to get big refunds, you can play with the Calculator to see what W-4 choices you need to make to generate a specific refund amount.
Answer this question--will you save the $43/paycheck you might get from changing your withholding or is it just going to go toward entertainment or whatever? If you are disciplined enough to take that extra money and put it toward your retirement or emergency fund, by all means change your withholding. If not, the forced savings account might be a good idea. The $.85 you might earn on interest on those funds over the course of the year really isn't worth it....
Answer this question--will you save the $43/paycheck you might get from changing your withholding or is it just going to go toward entertainment or whatever? If you are disciplined enough to take that extra money and put it toward your retirement or emergency fund, by all means change your withholding. If not, the forced savings account might be a good idea. The $.85 you might earn on interest on those funds over the course of the year really isn't worth it....
I am not concerned about my ability to save money. I just want what I earn, when I earn it.
Mr_Geek, when you speak with your tax professional, bring your 2012 income tax return with you. The tax professional will use that to help him prepare your 2013 income tax return. At the same time he will use both income tax returns to help you fill out your W-4.
You are always able to change a W-4 throughout the year. The more dependents you claim, the less tax will be taken out of your paycheck. So, if you are married, count your wife as a dependent. If you have children, count each of them as a dependent. If you care for your parents and can claim them on your income tax return, count them. If you own a house, count it. If you don't have any spouse/children/house or parents, then just claim yourself and that should work.
Mr_Geek, when you speak with your tax professional, bring your 2012 income tax return with you. The tax professional will use that to help him prepare your 2013 income tax return. At the same time he will use both income tax returns to help you fill out your W-4.
You are always able to change a W-4 throughout the year. The more dependents you claim, the less tax will be taken out of your paycheck. So, if you are married, count your wife as a dependent. If you have children, count each of them as a dependent. If you care for your parents and can claim them on your income tax return, count them. If you own a house, count it. If you don't have any spouse/children/house or parents, then just claim yourself and that should work.
Just curious how last years will help fill out my w4 since I have a different job and salary now?
It gives the tax preparer your income history, your tax liability last year, and how much you over-paid. There is a little part in the Federal tax law that tells you how much you can owe at the end of the year without paying a penalty, and part of the calculation is last year's tax liability.
Mr_Geek, when you speak with your tax professional, bring your 2012 income tax return with you. The tax professional will use that to help him prepare your 2013 income tax return. At the same time he will use both income tax returns to help you fill out your W-4.
You are always able to change a W-4 throughout the year. The more dependents you claim, the less tax will be taken out of your paycheck. So, if you are married, count your wife as a dependent. If you have children, count each of them as a dependent. If you care for your parents and can claim them on your income tax return, count them. If you own a house, count it. If you don't have any spouse/children/house or parents, then just claim yourself and that should work.
Quote:
Originally Posted by Mr_Geek
Just curious how last years will help fill out my w4 since I have a different job and salary now?
ummm....or....you can just do what i suggested above. it's simple, and you don't need a 'tax professional'!
Answer this question--will you save the $43/paycheck you might get from changing your withholding or is it just going to go toward entertainment or whatever? If you are disciplined enough to take that extra money and put it toward your retirement or emergency fund, by all means change your withholding. If not, the forced savings account might be a good idea. The $.85 you might earn on interest on those funds over the course of the year really isn't worth it....
What difference does it make. If you don't know what to handle money, you'll blow it either way. Doesn't make any difference if you blow is $43 at a time or $1118 in May.
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