Avoid negative tax surprises by reviewing tax withholdings. Taxpayers should monitor their returns and make sure withholdings are adjusted properly. Luckily, there is still time to adjust withholdings in 2022 and check to see next year’s return benefit. Adjustments made now can help taxpayers avoid paying penalties. ETax Services has the information taxpayers need to avoid tax hang-ups.
The following circumstances can require a taxpayer to adjust withholdings
- Marriage or divorce
- Newborn children
- Purchase a new home
- Tax law changes
Life can be unexpected, and the IRS understands that situations change. Visit our contact page to connect with a tax expert to review your adjustments.
How to Pay Taxes
Taxpayers usually pay throughout the year. Payment intervals can be withheld from the salary, quarterly, or a combination of both. The IRS reports that over 70% of taxpayers withhold too much resulting in a refund for them.
Other Impactful Items
As stated previously, unforeseen situations occur and can impact withholding amounts. These other qualifying life events include:
- Coronavirus Relief for Taxes: This includes tax help for businesses, taxpayers, tax-exempt businesses, and others impacted by COVID-19.
- Natural Disasters: This includes wildfires, hurricanes, tsunamis, and other disasters. If a location is declared a disaster area by the federal government, the taxpayers in that location will have to adjust their withholdings.
- Lay off or Loss of Employment: This unfortunate circumstance can impact tax information though the IRS allows adjustments.
- Gig Economy Transition: Taxpayers in the gig economy can prevent penalty payments by reviewing estimated tax payments. People who earned a certain amount in one year may have to file documents such as the 1099 NEC.
Etax has the best tax updates and information for taxpayers. Visit our contact page to book an appointment with an expert tax agent.