An important thing to do at the beginning of the year is to take the time to make sure your withholdings are accurate for your family. You can also easily adjust the amount you are having put into retirement, and savings at this time. You can easily figure out how much you should be withholding by using the calculator provided by the IRS. Here are five reasons that your withholdings may have changed in the last year.
1) You have had a child. This will increase the tax credit that you can claim. You should adjust your withholdings accordingly. You and your spouse should decide who should claim which children on which paycheck.
2) You recently got married. Single and married tax rates are different. It is important you adjust accordingly so that you do not have too much or too little taxes withheld over the year.
3) You had a child move out on his own. This is one less dependent that you can claim. If you do not make the adjustment, then you will end up owing taxes. If you have been supporting someone who recently married, you most likely will need to change your withholdings as well.
4) If you received a raise in the past year, this may put you in a higher tax bracket. You can find out if you need to adjust your withholdings by visiting the tax calculator. The calculator looks at your income, as well dependents when calculating the variables.
5) If you or a spouse just returned to working, you will want to adjust your withholdings as well. If you do not you could easily end up owing money, since you will be in a higher tax bracket than normal.
If any of these events happen during the year you can easily go back on, and reevaluate. You will simply need your most recent pay stubs, and the amount of mortgage interest and any other deductions you plan to claim. This is a simple process, but will help you to receive the proper amount in your paychecks.
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