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  • Hello, I’m Tammy from Turbo Tax with some important information

  • for taxpayers who still owe tax when filing their return.

  • If you finish your tax return and are confused as to why you need to send the IRS a check,

  • there is only one possible explanation for this:

  • you paid less tax during the year than you owed for your income level.

  • The reasons for this situation, however, can varybut you can easily prevent this

  • from happening next year if you get to the root of the problem.

  • If you are employed by a company, the IRS requires your employer

  • to withhold a portion of your salary to pay your federal taxes.

  • The amount withheld depends on a number of factors

  • but you do have some control over how much is taken out of your paycheck.

  • The W-4 form you filled out when you started your job allows you

  • to modify how much tax is withheld from your paychecks.

  • The good news is, you can fill out a new W-4 form any time you’d like,

  • and if necessary, you can increase your withholding to avoid a nasty tax bill at the end of the year.

  • If you are unfamiliar with the W-4 form, you should understand

  • how allowances work before making adjustments to it.

  • Essentially, each allowance you report represents a reduction to your taxable income--

  • such as for the dependent exemptions you anticipate claiming on your tax return.

  • The more allowances you report on your W-4, the less tax that is withheld from your paycheck.

  • If you report more allowances on your W-4 than dependents on your tax return,

  • you could end up writing a check to the IRS come tax time. This is just one example.

  • You can test different scenarios using the W-4 Calculator

  • on our Tax Calculators and Tips page at TurboTax.com.

  • This can help you get the outcome you want next yearwhether it’s a big tax refund

  • or more money in your paychecks week to week.

  • Self-employed taxpayers, though not subject to withholding,

  • can face similar issues when they fail to make estimated tax payments.

  • As a self-employed taxpayer, you have an obligation to make up to four of these

  • estimated tax payments to the IRS throughout the year.

  • If you don’t report any income until you file your tax return

  • youll have no choice but to make one larger tax payment.

  • But you should also realize that the IRS may charge you interest and penalties

  • for failing to make sufficient quarterly estimated payments.

  • Whether you are expecting to pay, or get a big tax refund,

  • TurboTax will guide you step by step to help you get all the tax breaks you have coming.

  • For more information about this and other tax topics, visit TurboTax.com.

Hello, I’m Tammy from Turbo Tax with some important information

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