Tax Refunds and Withholding

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The most important thing most people want to know about their tax return is how much tax refund they will get back.

As you use TaxAct, you can see how much you owe or are receiving as a refund as you enter information on your return. As TaxAct helps you find every tax benefit to which you are entitled, that number should look more and more favorable.

No one complains when they get a healthy tax refund.

Nevertheless, the first thing you should do when you get an especially large refund is to make sure it doesn't happen again next year.

Getting a huge refund every year means you're having too much income tax withheld from your paycheck all through the year, or you're paying too much in estimated taxes.

You can make better use of your money by keeping it in your control all year.

If you have high interest credit card debt, you're better off using the money to pay off that debt as soon as possible. If you have an emergency, your money should be someplace where you can access it if you need to.

If you use overwithholding as a kind of forced savings plan, consider other automatic savings plans that give you a better return and let you keep your own money. You can have your employer deduct some of your pay for a retirement plan, or deposit it directly into savings for you. Or you can set up an automatic online plan for investing or transferring to a savings account.

Some people hesitate to lower their income tax withholding because they're afraid they might end up owing money when they file their taxes. They'd rather shortchange themselves all year than possibly end up with a bill at tax time.

You don't have to choose between having way too much withheld or worrying about owing taxes at the end of the year. Using the Form W-4 Withholding section, you can make sure your income tax withholding more closely matches the amount you owe the IRS when you file.


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Upcoming Tax Dates

September 5 — Everyone
Federal Holiday (Labor Day) Details

September 10 — Employees who work for tips
If you received $20 or more in tips during August, report them to your employer Details

September 15 — Individuals
Make a payment of your 2018 estimated tax if you are not paying your income tax for the year through withholding (or will not pay in enough tax that way). Use Form 1040-ES. This is the third installment Details

September 15 — S Corporations
File a 2017 calendar year income tax return (Form 1120S) and pay any tax due. This due date applies only if you timely requested an automatic 6-month extension Details

September 15 — Partnerships
File a 2017 calendar year return (Form 1065). This due date applies only if you were given an additional 5-month extension Details

September 15 — Corporations
Deposit the third installment of estimated income tax for 2017 Details

September 15 — Social security, Medicare, and withheld income tax
If the monthly deposit rule applies, deposit the tax for payments in August.

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