SEATTLE — Tax day has come and gone, and it left many Americans scratching their heads thanks to the first filing under the 2018 Tax Cuts and Jobs Act. KIRO 7 is breaking down the steps you can take now to eliminate any surprise tax debt or refund when you file in 2020.
Under the new tax law, roughly 80% of Americans paid less in taxes overall this year. But according to a new CBS News poll, three out of four people said their tax bill at filing time was actually higher or unchanged.
David Tucker, of the IRS Seattle office, met with KIRO 7 this week and explained why some people were caught off guard.
“They'll get employed by an employer, they'll fill out a W-4 and they never touch it again,” Tucker said.
“The thing is that, if you had a significant (event) in your life, like you got married, had a child or had a significant change in your income, or if you've had a tax reform law like we've recently had, those things can impact your withholding.”
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Your tax withholding is something most people never think about again, but the IRS now has an online withholding calculator to help you eliminate the surprise.
“We call it a paycheck checkup,” Tucker said.
You’ll want to have your latest paycheck, your estimated mortgage interest for the year and other anticipated write-offs. The form took us about five to 10 minutes to fill out.
“And it'll tell you whether you'll have a tax liability or a refund,” Tucker said. “And then what you do is adjust your W-4 accordingly and refile that with your employer.”
You can find the W-4 form here.
Print it out, make the recommended changes from the calculator and give it to your employer.
That way, you'll either keep more money in your pocket throughout the year or make sure you don't owe a bunch of money next April 15.
Cox Media Group