Whether or not you owed taxes or received a refund last year, check your tax withholding to avoid having too little tax withheld and facing an unexpected tax bill or penalty at tax time next year. On the other hand, if you have too much withheld and receive a large refund, you will have lost out on having the money in your pocket throughout the year. Changing jobs, getting married or divorced, buying a home, or having children can all result in changes in your tax calculations.
The IRS withholding calculator on IRS.gov can help compute the proper tax withholding. The worksheets in Publication 505, Tax Withholding and Estimated Tax, can also be used to do the calculation. If the result suggests an adjustment is necessary, you can submit a new W-4, Withholding Allowance Certificate, to your employer.
