401k contributions

Forum|Forum|27 days ago
May 13, 2026
1 reply
8 views

I had to pay over $4k in taxes this year, If I increase my 401k contribution, will that help me avoid owing taxes next year?

Ask the Experts - W4 - May 2026

dev145

Employee Tax Expert

Contributing to a 401k is a sound retirement strategy that lowers your taxable income and reduces your total tax liability. However, it may not entirely eliminate the possibility of owing taxes, particularly if you have additional income sources with insufficient withholding. Before increasing your contributions, it is important to evaluate how a smaller paycheck might affect your lifestyle. Keep in mind that 401k funds are intended for retirement; withdrawing them early results in a 10% penalty in addition to regular income tax.

If increasing 401k contributions is not the right approach for you, making quarterly estimated tax payments to the IRS is an alternative to prevent a large balance due during tax season.

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Regards,
TurboTax Expert

17780910375Author

Level 2

This is very helpful, as I prepare for 2026 filing. Does turbotax offer any type of expert help/review that can take a look at my current W4/or 2025 filing and provide me advice on what else I can tweak to avoid owing taxes?

dev145

Employee Tax Expert

TurboTax provides assistance for these types of situations. Please be aware that while we offer various options to help reduce your tax burden, we cannot guarantee specific outcomes. Factors such as new tax legislation, changes in your income, or updates to your filing status can occur throughout the year and impact your final results.