Find out if you'll get a refund or owe money at tax time. Enter your income, withholdings, and credits to see your projected federal and state tax outcome.
A tax refund happens when your employer withholds more tax from your paychecks than you actually owe for the year. The IRS returns the overpayment to you as a refund when you file your return. While getting a refund feels good, it means you gave the government an interest-free loan throughout the year.
You may owe taxes if your withholding was too low relative to your actual tax liability. This commonly happens when you have multiple income sources, significant investment gains, or your W-4 is set up to withhold less than needed. If you owe more than $1,000, you may also face an underpayment penalty.
Contributing to a 401(k) reduces your taxable income, which can turn a balance due into a refund or increase your existing refund. Every dollar contributed to a traditional 401(k) reduces your adjusted gross income, saving you money at your marginal tax rate.
The child tax credit is worth $2,000 per qualifying child under age 17. This is a credit (not a deduction), so it directly reduces your tax bill dollar-for-dollar. To adjust your withholding and get the right amount taken out each paycheck, submit an updated W-4 to your employer.