Why do I owe taxes this year

It depends.

 

It could be because you made more income this year as you asked.

 

Or it is possible that you had more withheld in income tax payments on your earnings last year than this year which resulted in owing taxes this year.

 

Also, there are many factors that go into determining your overall tax balance, such as other sources of income or credits you could be entitled to.

 

It essentially depends upon your overall tax return from 2019 to 2020.  Any changes from year to year will impact your overall refund or tax liability when you file.

 

In TurboTax, you can view your tax summary for your 2020 tax return by doing the following:

1. Go into the black panel on the left and select Tax Tools. 
2. Then select Tools beneath Tax Tools. 
3. A "Tools Center" box will pop up, select "View Tax Summary" 
4. You will see a screen that gives a snapshot of your taxes based upon your input so far. 
5. Click on the black panel on the left bar and select Preview my 1040
6. This will allow you to review your overall line items on your federal tax return.  Compare these amounts to your actual tax return for 2019 to help you determine why there is such a large difference from year to year.

 After you review the above items, simply select "Back" in the black panel to get back to the interview forms. 

Will I still receive money to my account 

Although you may owe taxes you still may get a stimulus payment this year.

 

To determine why you owe taxes you can check these areas.

 

If you have your year to year comparison (you can get this in the Online version if you pay for TurboTax, but don't file) it will show you what areas changed.

 

There are three factors that will determine the size of your refund (or what you owe).

 

1. The total amount of income that you have.
2. The amount you had withheld from your wages.
3. Whether you qualify for certain tax credits.

 

Your income determines the amount of tax you owe.  This not only includes your wages, but also any other type of income you may have had.  A small job that issued a 1099 MISC or NEC can result in significant taxes.  Based on criteria established by the IRS there are tables that determine the amount of tax that you owe.  Double check your income entries and make sure they are correct.

 

The amount you had withheld generally come from your W-2 income; however, taxes can be withheld from other forms of income.  If the taxes withheld is more than what you owe you will get a refund.  If not, you will owe money.  Again, double check your entries and be sure they are correct.

 

You can subtract Tax Credits from the amount of tax you owe.   Here are some common Credits:  

If you look on your tax return FORM 1040 you can check these entries.

• Line 19 Child Tax Credit
• Line 27 Earned Income Credit
• Line 28 Additional Tax Child Tax Credit
• Line 29 American Opportunity Credit (For College)
• Line 30 Recovery Rebate Credit
• You also may have had more taxes withheld on your income.

Compare your tax credits to what you had last year.  This is the most likely place for a large amount to be.