Less Tax, More Money In Your Paycheck – MPSOS195

More money less taxes in my paycheck

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Less Taxes, More Money In Your Paycheck

Has your income been steady all year?   

What about your charitable giving or property taxes?

I am 100% certain that your income tax return for 2015 will be different than last year’s return.

If your income, expenses, or deductions are different then your tax liability will be different too.

Large tax refunds are inefficient uses of money – for both you and the government!

Perform a mid-year tax review

Why? So you can make changes in your with-holdings before the year ends.

One of my clients did a mid-year calculation and was able to make adjustments that put her within $33 of perfection!

What does that mean?

It means she was able to bring more money home, pay off more high-interest rate debt, and not owe a bunch of money at the end of the year.

Here is what you can do:

Gather together the following items

  • Last year’s tax return
  • Last year’s Schedule A (if you itemized deductions)
  • Your last two pay stubs (include your spouse's as well)

Note: If you have a small business or are an entrepreneur then you will need to run a Schedule-C calculation to estimate self-employment income.

Also, you will want to estimate any

  • Child/Dependent Care expenses
  • Expected bonuses
  • Expected interest, dividends, etc

I use tax preparation software to run my calculation but you could follow the prompts at the IRS website to complete a mid-year tax assessment:

http://apps.irs.gov/app/withholdingcalculator

If you expect a huge refund

Do you know why stories of people with $.32 refund checks are in the news? Because they are so rare!

You could choose to do nothing and continue giving the government more of your money, interest free, and get a huge refund April 15th.

However, I recommend you increase the number of allowances  on your W-4 and give it to your benefits department or HR person. They will adjust your withholding to get you closer to zero.

Getting closer to zero can help you use YOUR money THIS year without breaking any rules.

Your results will vary. The tax code is so complex and everyone’s situation is so different that there is no way to predict your tax liability.

The IRS doesn't want to issue refunds

The law requires we pay our income taxes. By overpaying, they are burdened with the responsibility of refunding the difference to us.

Of course, you don't want to owe taxes either. That is why I believe you should adjust your withholding to get a refund of less than $1,000 (less than $500 ideally) and use YOUR money to reach YOUR goals THIS year.

Make course corrections before you land

If you've over-withheld for the past seven months, and it takes a few weeks for your W-4 adjustments to take effect, then you'll only have a few months worth of paychecks to course-correct.

You could also perform another assessment in October to get even closer to zero as possible.

I have found August to be the best month to adjust our with-holdings.

What could you do with a bigger paycheck?

Remember my client who received a refund of $33?

She was able to eliminate two debts with the money she stopped sending to the government.

How much interest would you save, or debt could you avoid, if able to bring home $50, $100 or more each paycheck?

I offer a mid-year tax assessment to all my clients – and I can do it for you too.

For a limited time, I will help you calculate your 2015 tax liability, your expected shortage or overage, and have a short conversation to walk you through *adjusting your W-4.

CONTACT STEVE for tax assessment review

This services is only $25 and is only effective if you take action in the next 2 weeks. Schedule your appointment now by replying to this email.

*Disclaimer: I am not a tax preparer or tax advisor. This is a service I normally provide my U.S. clients as part of their coaching process. It is intended to provide valuable information only that you can use to improve your financial situation.


 

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