If you received a tax refund because you had too much tax withheld from your pay, you may be better off to have that money available to use to your advantage during the year. Many people like to count on that refund in the spring each year, but if you want to manage your finances more closely during the year, you may want to make a change on your W-4, Employee’s Withholding Allowance Certificate.
On the contrary, if you ended up owing taxes last year, you may want to change your W-4 to take out more tax. Ask your employer for a W-4 form. If you want less tax withheld, either change from the single rate to the lower married rate, or increase your number of withholding allowances. If you want more tax withheld, either change to the higher single rate, claim fewer withholding allowances, or include an additional amount of tax you want withheld.
Estimated Tax Payments
If you plan to have income other than from an employer this year, such as self-employment income, income from investments or rental property, you may need to make quarterly estimated tax payments during the year. These estimated tax payments are made using Form 1040-ES and are due on April 15th, June 15th, September 15th, and January 15th. You do not have to start making estimated tax payments until you have income on which you will owe tax.
E-filing
If you didn’t file electronically last year, you may want to consider doing so next year. The IRS website provides links to various free tax preparation and filing software programs. Filing electronically is easy and convenient; it can speed up your refund and, if you owe tax, you can schedule a payment as late as April 15th.