My husband and I have always gotten money back from our taxes. This year we got a little back from Federal and had to pay State. We have 4 children: one who we were not able to claim for the first time this year, one who lives with us full time, but pays her own college and works full time, one who turned 17 this past year, and one who is 10. We claim married filing jointly with 4 dependents. What do we need to change in order to either break even or get money back?
You will want to reduce the number of dependents you are claiming on your W4s. It sounds like in previous years you may have had multiple dependents that qualified for the Child Tax Credit, but at this point you only have one (the 10 year old). A child who has turned 17 doesn't qualify for the Child Tax Credit (up to $2000/yr) any longer, but might potentially qualify for the Credit for Other Dependents ($500/yr).
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If your 17 year old turned 17 during 2023, you already saw the impact of this on your most recent tax filing. On the other hand, if your 17 year old turned 17 during 2024, you will see an additional $1500 unfavorable change ($2000 -> $500) when you go to file taxes for 2024 next year.
So what would we change our dependents to?
My son turned 17 in 2023.
You no longer have you claim Filing Status (Single, Married Filing Joint, etc.) and the number of exemptions (0, 1, 2, etc.) on your W-4. Instead the IRS wants taxpayers to estimate what has been earned to date and how much has been paid in through withholding to calculate what the federal withholding should be for the rest of the year.
Turbo Tax has a great tax caster tool to estimate your taxes. It will also allow you to adjust your withholdings with an updated W-4 to provide to your employer.
https://turbotax.intuit.com/tax-tools/calculators/taxcaster/
https://turbotax.intuit.com/tax-tools/calculators/w4/
Using the tax caster allows you to do "what if" scenarios like increasing your charitable contributions and retirement plan contributions if applicable.
Here are some tax planning tips: https://turbotax.intuit.com/tax-tips/tax-deductions-and-credits/7-best-tips-to-lower-your-tax-bill-f...