turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

I owed a lot this year, for the first time ever. I think I know why but I'm not certain and I want to avoid this next year.

I had three jobs in 2022 and that's likely to continue this year. 2022 was the first year we didn't claim a dependent. Also, we use the Healthcare Marketplace and somehow received more advance payments on the Premium Tax Credit than we were actually entitled to (lines 24 & 25 on form 8962). Every year prior we've received a refund but this year we owed quite a lot. . From what I can grasp, merely dropping a dependent may have accounted for much of the owed amount (no child tax credit, no Premium Tax Credit on the marketplace). Is that correct?

 

More importantly, what can I do to avoid owing next year? It's my understanding that at least part of the answer to that is to adjust my withholdings but:

  1. How do I do that?
  2. How do I know how much to adjust?
  3. Will this be different for people like me who have multiple jobs than if I just had one?
  4. How did the government give us more in advance payments on our PTC than we were actually eligible for?

Thanks.

x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

1 Best answer

Accepted Solutions
BillM223
Expert Alumni

I owed a lot this year, for the first time ever. I think I know why but I'm not certain and I want to avoid this next year.

1. Many, many taxpayers have noticed their taxes increase this year. This is often due to the ending of the pandemic tax benefits by the end of 2021.

 

2. It is common for taxpayers with multiple jobs to under withhold and thus owe tax at tax time. This is because the withholding for one W-2 assumes that this is your only job, and uses the withholding appropriate for a lesser income. So three jobs just digs you in a bigger hole, unless you change the withholding in one or more jobs.

 

3. Right now, take a look at the IRS Tax Withholding Estimator, and see if it will help you adjust your withholding. Of course, you can always skip that and just make an additional estimated tax payment online at the IRS website

 

As for the PTC, when you end more at the end of the year, it's generally because you underestimated how much income you would have this year. NOTE: when you have life changes, like another dependent (or losing one), or a new job, you need to call the Marketplace and review your situation so that the amount of PTC is appropriate. 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

View solution in original post

3 Replies
BillM223
Expert Alumni

I owed a lot this year, for the first time ever. I think I know why but I'm not certain and I want to avoid this next year.

1. Many, many taxpayers have noticed their taxes increase this year. This is often due to the ending of the pandemic tax benefits by the end of 2021.

 

2. It is common for taxpayers with multiple jobs to under withhold and thus owe tax at tax time. This is because the withholding for one W-2 assumes that this is your only job, and uses the withholding appropriate for a lesser income. So three jobs just digs you in a bigger hole, unless you change the withholding in one or more jobs.

 

3. Right now, take a look at the IRS Tax Withholding Estimator, and see if it will help you adjust your withholding. Of course, you can always skip that and just make an additional estimated tax payment online at the IRS website

 

As for the PTC, when you end more at the end of the year, it's generally because you underestimated how much income you would have this year. NOTE: when you have life changes, like another dependent (or losing one), or a new job, you need to call the Marketplace and review your situation so that the amount of PTC is appropriate. 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

I owed a lot this year, for the first time ever. I think I know why but I'm not certain and I want to avoid this next year.

Thank you so much! That's exactly the info I was looking for.

LindaS5247
Expert Alumni

I owed a lot this year, for the first time ever. I think I know why but I'm not certain and I want to avoid this next year.

You will need to fill out a new Form W-4 with your employer(S).  There are worksheets and instructions attached to this form that help you estimate when you have multiple jobs,

 

 

 

 

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question
Manage cookies