Was Your Tax Refund Too High or Low?
Adjusting your
withholding solves the problem
Now that you’ve filed your 2004 tax
return, you may be asking how you can adjust your refund for next year.
Adjusting the amount of your refund, or ensuring you have no balance due,
is as easy as adjusting your withholding from your paycheck.
You can file a revised Form W-4 with
your employer at any time to either increase or decrease the number of
exemptions you claim. Increasing your exemptions results in less tax being
withheld from your paycheck each pay period. Decreasing your exemptions
results in the opposite. The
includes a worksheet and instructions on how to calculate the proper
number of withholding allowances.
If you are self-employed, a mid-year review with your tax professional may
be in order. The amount of estimated taxes you are required to pay may
need adjusting to reflect an increase in your income or unexpected
expenses. Taking the time to make those adjustments now will prevent
unwanted surprises when it comes time to file your 2005 tax return.
