I have tried to get my withholdings correct now for quite some time time. Each year we wind up with a tax bill.
I decided to try the Turbotax calculator. I am not sure it helped very much, so apparently I am not going about this via the correct method.
The calculator info. includes this observation:
"If you make adjustments in the middle of the year, your results may vary."
Will you please explain what this means?
I receive an annual pay increase that does not coincide with the calendar year, so I presume I am one of the people to whom the above quote applies.
In addition, my wife just began a different job with slightly higher pay. On top of that, she received a modest raise in pay at her former job not long before she took her new position.
What is a person supposed to do to obtain an accurate calculation of withholdings in this tangled and convoluted situation?
Do I need to hire a CPA?
Here is what I tried.
I have had the same job all year. I have the higher annual income (about 2X) compared with my spouse.
In the Turbotax calculator, I entered info. regarding what my income and withholdings were before my pay raise this year as "Job 1".
Next I filled in income and withholdings information for the time period after my pay raise (through year's end) as "Job 2"
I then entered my wife's information before she got a pay raise at her old job as her "Job 1".
Then I filled out separate information for my wife after her pay raise at her old job as "Job 2".
Last, I entered still separate information for her as to her new job ("Job 3"); she has not yet received a paycheck for her new job ("Job 3").
The calculator says "we're golden", no adjustments to be made.
That sounds flatly incorrect.
I double-checked the numbers -- my entries are accurate as generally described above.
In terms of general approach, should I be doing something differently here?
I do not understand why this has to be so complicated, but thanks for your help.
