Midyear tax tip #3: Adjust withholding

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Midyear tax tip #3: Adjust withholding

Wednesday, June 23, 2010

Now that the 2010 tax year is half over, it's time to ask yourself some questions.

Did you end up writing a large check to Uncle Sam that included an underpayment penalty?

Did you receive a large refund check?

If you answered "Yes" to either question, The Missouri Tax Guy Bruce says it's time to make a Midyear Tax Move.

The key is to send the IRS only enough money to avoid interest and/or penalties. It's easy to do by adjusting your withholding.

If you think that you'll owe more taxes this year, adjust the number of allowances (fewer mean you'll have more taxes taken out of your paycheck) on your W-4 or pay more in estimated taxes.

To cure an overpayment situation that you may be facing, consider increasing the number of allowances claimed. That will get you, instead of the IRS, more money each payday.

By making the appropriate correction, you'll get the benefit of owing the IRS the right amount.

More midyear tax tips on their way: Thanks to Bruce and his always timely tip to reevaluate your withholding.

If you have a tax move we can make now to help reduce our upcoming 2010 tax bill, we'd love to hear from you. I'll be posting the tips, one a day until we run out.

If you're succinct, I'll take your tip via Twitter @taxtweet. Got a bit more to say, post it on the ol' blog's Facebook page.

And if you want a chance to win a New Yorker desk diary, check out the details here (the entry deadline has been extended to June 27).

Related posts:

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Posted on Wednesday, June 23, 2010 at 06:21 PM in Midyear tax moves, Tax Tip, Withholding | Permalink | Comments (0)

Tags: midyear tax move, taxes, withholding

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Weekly Tax Tip

Tax differences of home repair vs. home improvement — Keeping up a house takes a lot of work. In some cases, generally where you improve the property, the effort could help lower or eliminate a possible tax bill. In others, where you simply take care of necessary repairs, you'll make the place better, but without any tax benefit. (Aug. 16, 2019)
Check out all the latest post-Tax Day tax advice in the 2019 edition of Weekly Tax Tips. Many of these once-a-week tips will focus on planning moves to cut your 2020 tax bill. If, however, you're working on a filing extension for your 2018 return, you can get a refresher of the 2019 Filing Season Tax Tips at their respective monthly pages: January, February, March and April.

All About Kay

OK, some about Kay

Kay Bell — Native Texan (the blog title totally makes sense now, right?). Professional journalist. Tax geek.

My Other Accounts

Tick ... Tick ... Tick

Tax Season 2019 continues!
Are you among the almost 15 million taxpayers the IRS estimates are now on extension to file their 2018 tax returns? That new Oct. 15 tax filing deadline will be here before you know it. The countdown clock below will help you track the days until that absolutely final filing due date arrives. Maybe in the next six months, we'll have a better handle on the Tax Cuts and Jobs Act changes!
Note: I'm in the Central Time Zone, so adjust accordingly for where you live.

Time for Tax Tasks

Aug. 1: It's August, the month we experience some of the year's hottest temperatures and the
Dog Days of Summer. This pooch definitely knows how to deal with the warm weather.
via GIPHY

Check out these tips to help keep your pet, yourself and possibly your taxes cool as thermometer readings rise.

You also can chill this month after you make some tax moves over the next 31 days to lower your potential 2019 tax bill.

Aug. 2, 3 & 4: School will be starting soon across much of the United States. That's why the bulk of the annual back-to-school state sales tax holidays are or start this first weekend of August.
This year, that's 9 of 16 tax-free events.

Savvy shoppers who take advantage of these six tax holiday shopping tips can save this weekend at sale-tax-free events in Arkansas (Aug. 3-4), Florida (Aug. 2-6), Iowa (Aug. 2-3) and from Aug. 2-4 in Missouri, New Mexico, Ohio, Oklahoma, South Carolina and Virginia.

Aug. 7: School supplies shopping notwithstanding, until classes actually start you'll need to keep the kiddos occupied for these final few weeks of summer. Day camp is a great option. Even better, the costs for these camp costs can count toward claiming the child and dependent care tax credit, so hang onto those day camp receipts.

Aug. 9, 10 & 11: Two more states keep the sales tax holiday ball rolling starting this weekend. Certain items are tax free in Texas from Aug. 9-11. Maryland's sales tax holiday also starts on Aug. 9 and runs through Aug. 17.

Aug. 12: Does your job include tips?
If so and you received $20 in tips in July, use Form 4070 to report your tips today to your employer. Note that if you participate in a tip-splitting arrangement, like the tip-pooling option recently approved by the Department of Labor, you only have to report the tips you receive and retain.

Aug. 17 & 18: The final two sales tax holidays are this weekend, with Massachusetts' set for Aug. 17-18 and Connecticut's week-long event starting Aug. 18 and ending Aug. 24.

Aug. 22: The wrapping up of the final back-to-school tax holiday sales are a sure sign summer is winding down. That means in addition to getting binders and backpacks and myriad other school materials, it's time for parents to do their homework on ways to pay for educational costs at from K-12 level through college. The tax code offers a variety of educational tax breaks that can help cover educational costs.

Aug. 28: If you didn't file your 2018 tax return by April 15 and instead delayed the inevitable by getting an extension, now's a good time to finish filling out that Form 1040 well before the final Oct. 15 deadline. Free File can help. It's available through that final October filing deadline.

The IRS-tax software industry's no-cost return prep and e-filing option is open for business through the Oct. 15 extension deadline for taxpayers whose income is $66,000 or less.

Aug. 31: August is over, but not the Atlantic Ocean/Gulf of Mexico hurricane season, which runs through Nov. 30.

We've been lucky so far, with only one storm, fsdafda, making landfall back in July. But as temperatures het up, so does hurricane formation. The countdown clock below can help you keep track of how many more days we have to worry about tracking any tropical depressions, storms or 'canes.

You can find more on getting ready, physically and financially, for hurricanes, as well as tax help for recovery efforts and tax deductions for donations to those who are hit by natural disasters at the ol' blog's Storm Warnings page.

Small Business Tax Calendar: Important filing, deposit and record keeping dates throughout the year that your company needs to know. You can get more tax calendar information at the IRS' online calendar page and view the full year's important business and individual tax dates in IRS Pub. 509.

State Tax Help

Don't forget your state taxes!
Forty-three states and D.C. collect personal income taxes. But even if you live in of the seven states without an income levy, you still face other state (and local) taxes.

State Tax Departments provides links to your state's Web page. The companion page, Tax Tidbits, is the compilation of blurbs about each state's tax laws. And for more state tax news, check out all our state tax bloggings.

0, 1, 2, 3, 4, 5, 6, 7, 8, 9 ...

Taxes are all about the numbers.
Check out these (mostly) weekly
By the Numbers figures.

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I gotta tell ya ...

AKA Disclaimer:
I am a professional journalist who has been covering tax issues since 1999.
I am not a professional tax preparer.
The content on Don't Mess With Taxes is my personal opinion based on my study and understanding of tax laws, policies and regulations. It is provided for your private, noncommercial, educational and informational purposes only. It is not a recommendation of any specific tax action(s) you should or should not take. Similarly, mentions of products or services are not endorsements. In other words, my ramblings on the ol' blog are free advice and you know what they say about getting what you pay for. That's why when it comes to filing your taxes, I urge you to get additional, professional, paid-for guidance from an accountant, Enrolled Agent or other qualified tax preparer who is familiar with your individual tax circumstances.

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