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Tax Withholding Estimator Helps Taxpayers Avoid A Surprise Next Year

Updated: Jan 2

The IRS encourages taxpayers to use the Tax Withholding Estimator to avoid a potential surprise when they file their tax return next year.


IR-2023-205


WASHINGTON – With 2023 rapidly coming to a close, the Internal Revenue Service today encouraged taxpayers to review their tax withholding as soon as possible to avoid a potential surprise when they file their tax return next year.

Although it’s best for taxpayers to verify withholding early in the year, an adjustment made in the final weeks of 2023 could still help to avoid an unexpected result, such as a big refund or a balance due, when filing taxes next year.


With only a few weeks left in the year, the IRS encouraged people who haven’t checked their withholding recently to do it soon so they can make any withholding adjustments needed. The IRS has several ways to help.


Tax Withholding Estimator

The Tax Withholding Estimator, also available in Spanish, can help taxpayers determine if they have too much income tax withheld and how to adjust tax withholding. In other cases, it can help taxpayers see that they should withhold more or make an estimated tax payment to avoid a tax bill when they file their 2023 tax return.


The tool offers workers, retirees, self-employed individuals and other taxpayers a simple-to-use, mobile-friendly way to calculate the correct amount of income tax they should have withheld from wages and pension payments based on their complete set of facts and circumstances.



tax withholding estimator dashboard
IRS Tax Withholding Estimator

Other items may affect 2023 taxes

Common and unforeseen life events can be a trigger to make withholding adjustments. They include:

  • Life changes such as marriage or childbirth – Getting married or having a child are just a couple of life events that can affect a taxpayer’s refund or how much they owe.

  • Job Loss – IRS Publication 4128, Tax Impact of Job Loss explains how this unfortunate circumstance can create new tax issues, such as receiving unemployment compensation.

  • Disasters such as wildfires and hurricanes – Special tax law provisions may help taxpayers and businesses recover financially from the impact of a disaster, especially when the federal government declares their location a major disaster area.


Do you need assistance with tax planning and consulting? Request a free consultation HERE with Mark W. Sullivan, EA


About the author

Mark W. Sullivan, EA, the founder of Sullivan Consulting, established the firm's roots in St. Louis, MO, in 1998. In 2020, he made a strategic move to the thriving business environment of Arizona. Mark specializes in the intricate realm of federal tax controversy representation, appeals, and consulting, catering not only to individuals and businesses but also extending his expertise to renowned law and accounting firms nationwide.

Mark's distinguished career includes serving as a consulting and expert witness in a multitude of civil and criminal cases, spanning several federal district courts. His credentials are underscored by an unlimited Enrolled Agents license, a testament to his exceptional knowledge and unwavering commitment to his craft. His recognition by the Internal Revenue Service for admission to practice is grounded in his extensive background as a Revenue Officer, having worked in demanding locations such as New York, NY, St. Louis, MO, and Washington, D.C.

Mark's extensive experience as a Revenue Officer has uniquely positioned him to navigate the intricate landscape of federal tax matters. Now, based in Scottsdale, AZ, Mark continues to offer his expertise to clients across the nation, ensuring that their interests are diligently and professionally represented.


 

Copyright 2023 Mark Sullivan Consulting, PLLC.


Disclaimer: This article is for information purposes only and cannot be cited as precedent or relied upon in a tax dispute before the IRS.


Additional references:

IRS Newswire Issue Number: IR-2023-205





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