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If you enter dependent information into the W-4 and multiply that number by $2000, it will result in LESS taxes being withheld from your paychecks (and possibly a larger amount due at the end of the year!)    By entering the dependent information in Step 3 of your W-4, you are telling your employer that you will be taking a tax credit at the end of the year for the dependent (and that you don't need as much tax taken out because you will have a credit for that amount to claim later.)    Keep in mind that the W-4 doesn't do a great job of capturing other income that you may owe taxes on such as pensions, investments, or rental properties.  If you have these other income sources, you will want to enter information about that income in Step 4(a).    If you have a second job or income from gig work, you would complete the Multiple Jobs Worksheet (found on page 3 of the form,) and then include the amount for extra taxes to be withheld from each paycheck on line 4(c)  

@J2Hanson wrote: Yes The letter said it was due to Social Security.  We changed the amount of taxable Social Security benefits on your tax return because there was an error in the computation of the taxable amount. The official answer from Turbotax that we got was, "it was confirmed that it was not defaulting to "yes," but was user entry. However, it was determined to be a poor user experience which lead to confusion and the program will be improved for TY25."   You always owe your own correct tax.  If you ended up paying interest or penalties, the Turbotax guarantee is supposed to cover that, but they seem to have determined this is "user error."  At this point, you would have to call customer support to escalate the issue.  We are not official support and don't have access to your account information.

Great Question!! It is absolutely not too late to update your W-4 now! In fact, it's highly recommended to update your W-4 whenever your financial or personal situation changes, or if you realize your withholding isn't accurate. Here's why and what you should know: You can change your W-4 at any time. The IRS allows you to submit a new Form W-4 to your employer whenever you need to adjust your withholding.   Adjustments take effect quickly. Once your employer processes your new W-4, the change in your withholding will typically take effect in your next one or two paychecks.   Mid-year adjustments are crucial. If you realize you've been under-withholding (not having enough taxes taken out) for the first part of the year, adjusting your W-4 now allows you to "catch up" on your tax payments over the remaining paychecks of the year. This helps you avoid a large tax bill or underpayment penalties when you file your tax return next year.     Waiting until the new year can lead to issues. If you wait until the beginning of the new year, you'll still have under-withheld for the current year (2025). This means you'd likely owe a significant amount when you file your 2025 taxes. Making the change now helps spread that tax liability across your remaining paychecks. Steps to take now: Use the IRS Tax Withholding Estimator: This is still the most accurate tool to determine the correct amount to withhold. Input your year-to-date income, any taxes already withheld, and your expected income for the rest of the year. Submit a new Form W-4: Once you have the recommended withholding amount, fill out a new Form W-4 and submit it to your employer's payroll or HR department.   Monitor your paychecks: After submitting the new W-4, check your next few pay stubs to ensure the federal tax withholding has been adjusted as you requested. By making this adjustment now, you'll be in a much better position to meet your tax obligations for the current tax year (2025). Please feel free to reach backout again if you have any additional questions or concerns. and thank you again, please have an amazing rest of your day!   **Say "Thanks" by clicking the thumb icon in a post **Mark the post that answers your question by clicking on "Mark as Best Answer.”      

The area where its asking for dependant and multiply i enter 2,000. It looks completely different than the other worksheet, so do that mean, more or less taxes will come out? Im trying to prevent from owing 

To adjust your withholdings TurboTax has an amazing tax caster to generate an updated W-4:   W-4 tax calculator  As you both work be sure that you fill out W-4 forms for each of you.  You can also consider increasing your withholding from the higher paying job to account for your dual incomes.   When completing your W-4 forms, ensure you account for all sources of income.    The US uses a progressive tax system where your tax rate increases as your income rises which can push your combined total income into a higher tax bracket which is likely why you have been penalized in the past for under withholding.

When you do the tax estimators, this will take into account the HSA and PFL.  When you speak of IRA contributions, does your company have 401K plans?  In most situations, it is best to max out the 401K.  If you are under 50, the max per person is $23500.  If you are over 50, there is a catch up and the max is $31000. As you can see, if both of you max out on your 401K, the total would be $47000 (under 50) and $61000 (over 50).  These numbers are for 2025.  Contribution limits change yearly. As for the HSA, the contribution limit for 2025 is $4300 for self only policies and $8500 for family policies.   Contribution limits change yearly.

If you are W-2 wage earner and you have Balance Due every year, definitely, you need to update your Form W-4.  Looks like you are not having enough withholdings.  Also if you have additional income besides W-2, you need to withhold additional taxes to account for that.  2024 W-4 Calculator below will get you very close to 2025.  An easier way to update W-4 is divide your balance due by number of paychecks remaining and enter that amount on line 4c as Extra Withholding.  For example, if you had balance due $3,000 and you have 15 remaining paychecks in 2025, then enter $200 as additional withholding on your Form W-4. Hope it helps. Tax withholding: How to get it right W-4 Calculator 2024  

The most accurate way to determine your withholding is to use a Tax Withholding Estimator: IRS Tax Withholding Estimator: This free online tool from the IRS is an excellent resource. It walks you through a series of questions about your income, deductions, and credits, and then provides a recommendation for how to fill out your Form W-4. You'll need your most recent pay stubs and your last year's tax return (if available). Find it here: https://www.irs.gov/individuals/tax-withholding-estimator General Considerations for a $72,000 Salary (for 2024 tax year, which you'll file in 2025): Without knowing your filing status (Single, Married Filing Jointly, Head of Household) or other deductions/credits, it's impossible to give a precise dollar amount. However, here's a general idea of how federal income tax works for a $72,000 salary in 2024 (the tax year you are currently in): Tax Brackets are Progressive: This means you don't pay one flat percentage on your entire income. Different portions of your income are taxed at different rates. Standard Deduction: Most people take the standard deduction, which reduces your taxable income. For 2024, the standard deduction is: Single: $14,600 Married Filing Jointly: $29,200 Head of Household: $21,900 FICA Taxes (Social Security and Medicare): These are separate from federal income tax and are automatically deducted by most employers. Social Security: 6.2% on income up to the annual limit ($168,600 for 2024). Medicare: 1.45% on all earned income. Example Calculation (for a Single Filer, without other deductions/credits): Let's assume you are a Single Filer and take the standard deduction. Gross Income: $72,000 Less Standard Deduction: $72,000 - $14,600 = $57,400 (This is your estimated taxable income) Now, let's apply the 2024 tax brackets for a Single Filer to your taxable income of $57,400: 10% bracket: $0 to $11,600 taxed at 10% = $1,160 12% bracket: $11,601 to $47,150 (amount in this bracket: $47,150 - $11,600 = $35,550) taxed at 12% = $4,266 22% bracket: $47,151 to $100,525 (your remaining taxable income: $57,400 - $47,150 = $10,250) taxed at 22% = $2,255 Estimated Annual Federal Income Tax: $1,160 + $4,266 + $2,255 = $7,681 If you are paid bi-weekly (26 paychecks a year): $7,681 / 26 paychecks ≈ $295.42 per paycheck. Important Notes: This is a simplified estimate. Your actual tax liability can vary significantly based on your specific situation (filing status, dependents, additional income, itemized deductions, tax credits, etc.). The IRS Tax Withholding Estimator is always the best tool because it accounts for all these factors. It's generally better to over-withhold a little than under-withhold, as under-withholding can lead to penalties. If you over-withhold, you'll simply receive a larger tax refund. Review your withholding annually or whenever you have a major life change (marriage, new child, new job, etc.). Helpful links: Form W4 and your Take Home Pay TurboTax  What is a W4 Form? TurboTax  W4 Calculator TurboTax  IRS Withholding Estimator  Please feel free to reach backout with any additional questions or concerns you might have! Thank you for joining us today and have an amazing rest of your day!   **Say "Thanks" by clicking the thumb icon in a post **Mark the post that answers your question by clicking on "Mark as Best Answer.”    

Congratulations on your new investment! Owning rental properties will undoubtedly impact your tax liability at the end of the year. To prepare, I recommend calculating your taxable profit from the investment property. If you anticipate a gain, you can either adjust your paycheck withholding or make estimated quarterly payments directly to the IRS—the latter option provides greater flexibility in adjusting payment amounts.   Below are useful tools, informational resources, and IRS links to help you manage your rental property taxes: Rental Property Income Calculator  & Depreciation Calculator  – Various online tools can help you calculate your net income, factoring in rental earnings and depreciation. Understanding Rental Income Taxation  – Rental income is generally classified as passive income for tax purposes, even if you actively manage the property. Losses from rental properties typically offset only other passive income, not active income like wages or business earnings. TurboTax Rental & Real Estate Tax Guide  – A collection of articles that explain how rental properties are taxed and offer guidance on managing deductions. IRS Tax Withholding Estimator   and TurboTax Calculators & Tools – These tool helps determine how much tax you owe based on your income, deductions, and credits. IRS Estimated Tax Payments  – If you prefer not to adjust paycheck withholding, you can pay estimated taxes directly to the IRS. By planning ahead and utilizing these resources, you can better manage your tax obligations and avoid surprises at tax time.   Good Luck! 

I used the calculator and input my most recent paystub information all correctly and it says that I am actually withholding more than needed per paycheck; however, last year I owed money (hundreds) in federal and state. I think this may be due to my brokerage accounts with Vanguard? How do I use the calculator to add in the returns for that?  How do I know how to use this correctly to adjust the form if the calculator is giving me information that contradicts the empirical results?

Since you purchased property, I am assuming you are concerned about whether you will have enough tax paid in to cover any income from the property (in addition to your W-2-based employment income). If this property is not income producing (e.g., it's your first or second home and you don't rent it), it will not impact your taxable income until you sell it (although it might give you some tax deductions). So, the first question to ask is whether you anticipate net income from the property.  Most people with directly-owned property are filing a SCH E.  If you made net income on your property (after considering your deductions), you would want to consider paying estimated taxes on that income. If you end up with a loss, it will not increase your taxes due in that year. If you have a rental property and are also providing substantial services and meet all criteria, you may be filing a SCH C.  Most folks do not qualify.  Net income on a SCH C is also subject to self-employment taxes in addition to income taxes.  Here's a great explainer article on that.  Estimated taxes are due 4/15, 6/15, 9/15 and 1/15 for the final payment for the prior year.  You can also increase your W-4 withholdings instead, of course, but it is probably easier to pay the estimated taxes (the IRS doesn't care which way they get the money, as long as it is timely and enough.  The self-employment article also talks about underpayment penalties.  Hope this helps.  Great question, TeeTee! If I didn't understand, don't hesitate to follow-up.   **Please cheer or say thanks by clicking the thumb icon in a post **Mark the post that answers your question by clicking on "Mark as Best Answer" Regards, Karen TurboTax Expert  

Thank you for your response. I should have mentioned our expected gross income. Im expecting to make approximately $160k in 2025 (this includes bonus). My wife is expected to bring in $91k, before PFL. CA does not tax PFL, and will cover  70% of her salary, the other 30% will be from sick/vacation hours from her employer for 5-6 months. We max out our IRA's, so $15k jointly. I also max out an HSA, $4300 for 2025. 

The amount you paid with your extension was the tax you owed the IRS. Even though you get an extension to file your taxes you must pay them by 4/15 or you will get charged a penalty. The amount you pay TurboTax when you file is for the software you use to prepare them. "Start free, pay when you file."