When it comes to income taxes many people ponder the question “Will I be receiving a refund this year?” The 2018/2019 tax laws have changed as a result many Americans fail to revisit their withholdings throwing off their refunds and surprising finding themselves having to pay an IRS tax bill instead.
Tax holdings themselves is no easy task as the forms confuse a lot of Americans on how to properly fill them out. Most people turn in their withholding forms into their employer and never bother to glance at them or make sure their withholds are up to date. I don’t know how to emphasize this important task much more other than I hope this article reaches a lot of Americans. With the new tax laws, it does reduce the amounts you will pay, but a lot of Americans are not realizing that when April 15, 2019 rolls around they will be finding themselves having to pay.
Look at your Tax withholdings now!
The only time we all make changes to our withholdings is when there are major changes that happen to our personal lives such as getting married, having kids, buying a house or losing a family member.
It has been well over 20-30 years since our tax laws have seen some major changes. This coming year is going to surprise a lot of Americans. Here are some important changes that have occurred this year:
Tax rates are impacted by a huge reduction, The income tax brackets have been changed to cover more groups.
People will really notice that the standard deduction has doubled from $12,700 to $24,000 for married folks and $6,350 to $12,000 to single people.
Another important change is the deductions for state & local income and property taxes have been capped at $10,000 for both married & single groups.
All personal exemptions have been taken out.
The child tax credit has been doubled from $1,000 to $2,000 per child
This year I will still make the effort to itemize my deductions, but many articles, news publications, and podcasts have mentioned that the standard deduction was changed so that it would be more enticing to take the standard as many outlets have said the standard will be pretty comparable to the itemized way of deductions.
They are estimating that the new tax laws will allow about 67% of our taxpayers to pay less this coming year, about 25% of taxpayers will see no change, and about 7% of taxpayers will owe more this year. So basically there is a large percentage of taxpayers that will benefit from this year's new tax laws.
So why is it important for me to revisit my withholdings?
Because bottom line the amount you withhold depends on how much tax you pay from your withholdings. Remember the IRS has changed the withholding tables this year, so if you don’t check your withholdings and make the respected changes to your situation, you will find yourself with a tax bill due on April 19th!
How can I check to make sure my withholdings are accurate?
It is not very hard at all, there is actually a site that you can go to to help here is a withholding calculator I found online that can help you make sure you are taking the proper withholds: With Holding Calculator to get started make sure you have a recent paycheck and a recent copy of your last tax return. This tool will help you estimate this year's income and compare it to your current withholdings.
This is one way you can make sure you are taking care of your financial situation so that you can make sure you stay out of the “red” when it comes to your IRS responsibilities.
It is our passion to help individuals and families. If you live in the greater Austin area we would be happy to help make sure your financial situation is built on a solid foundation. Contact us today 512-568-7203 or message us at contact@YourFinancialFreedomNetwork.com
Rene Gonzales
Senior Representative
c. 512-568-7203
e. Rene.Gonzales@Primerica.com
w. www.Primerica.com/ReneGonzales
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