13 Smart Uses for Your Tax Refund

While you can still receive your refund in the form of a paper check, there are several advantages to direct deposit. Not only is it faster, direct deposit is also more secure. Refund checks sent through the mail can be lost, stolen, or returned to the IRS, if undeliverable.

Use your 2022 tax return as a guide in figuring your 2023 estimated tax, but be sure to consider the following. When To StartNo income subject to estimated tax during first period. Never assume all investment go for about the near future cost of a property, 8 Smart Ways To Use Your Income Tax Refund but regarding the making it a better complement your loved ones. Otherwise repairing a thing that might have been busted and you will was just over-finances. Promoting your own thrills at your home try a worthy funding to own your taxation refund.

Pay for Planning

If your AGI for 2022 was more than $150,000 ($75,000 if your filing status for 2023 is married filing separately), substitute 110% for 100% in above. Medicare wages and self-employment income are combined to determine if your income exceeds the threshold. A self-employment loss should not be considered for purposes of this tax.

“It’s more important to get it right than to get it out quickly,” said certified financial planner Marianela Collado, CEO of Tobias Financial Advisors in Plantation, Florida. Tax season officially kicked off for individual filers on Jan. 23. Before sharing sensitive information, make sure you’re on a federal government site. Stock investment is excellent for those who are already financially sound and secure.

Estimated Tax for 2023

Or you can get your taxes done right, with experts by your side with TurboTax Live Assisted. Just answer simple questions, and we’ll guide you through filing your taxes with confidence. Whichever way you choose, get your maximum refund guaranteed. Parents who are looking to invest in their child’s future education might want to consider a 529 college savings plan.

You can also find a copy of the worksheet in the instructions for Form 1040-ES. For more information about withholding, the substantial presence test, and Form 1040-ES , see Pub. This is income from catching, taking, harvesting, cultivating, or farming any kind of fish, shellfish , crustaceans , sponges, seaweeds, or other aquatic forms of animal and vegetable life.

Fund your retirement

A side hustle is an entrepreneurial hobby or extracurricular occupation that helps support your overall financial goals. Your tax refund could help you pay for parts and other necessary tools. If knitting, embroidery, or crafting is more your style, some cash from your refund could help you afford more supplies and support an online store. The average IRS tax refund last year for all 2017 returns was $2,825. That’s about 8.4% lower than the $2,035 in the comparable period last year.

• Prioritize which debt you would like to pay down/off first, then set an amount you will apply to that debt.
• A household worker is an employee who performs household work in a private home, local college club, or local fraternity or sorority chapter.
• She has been in the accounting, audit, and tax profession for more than 13 years, working with individuals and a variety of companies in the health care, banking, and accounting industries.
• NIIT is a 3.8% tax on the lesser of net investment income or the excess of your MAGI over $200,000 ($250,000 if married filing jointly or qualifying surviving spouse; $125,000 if married filing separately).
• There is a convenience fee charged by these service providers.

Tax burdens might increase because tax-reform revisions eliminated and trimmed some popular deductions. You are leaving AARP.org and going to the website of our trusted provider. Please return to AARP.org to learn more about other benefits. If you work and your spouse does not, you can also contribute to a Roth IRA in his or her name if your joint income is within those limits. Even if you’ve retired from your main job but are working part-time, you may be able to contribute to a Roth (see Part-Time Workers, Contribute to a Roth IRA).

If the actual value is more than the estimate, your employer must pay the IRS any additional withholding tax required. Your employer has until April 1 of that next year to recover from you the additional income tax paid to the IRS for you. If you don’t currently have an urgent situation loans, your taxation reimburse might possibly be a very good foundation first off putting aside extra cash tax 12 months. An emergency money can be your rainy date checking account, a finances set-aside as possible mark out-of if an unexpected debts appears.

If the first payment you are required to make is due April 18, 2023, enter ¼ of line 14a here, and on your estimated tax payment voucher if you are paying by check or money order15. You must notify the IRS if you are making estimated tax payments and you changed your address during the year. Complete Form 8822, Change of Address, and mail it to the address shown in the instructions for that form. In September, Taxpayer J amended the https://turbo-tax.org/ 2022 return by filing Form 1040-X, Amended U.S. Individual Income Tax Return. It turned out that Taxpayer J owed $250 more in tax than was originally thought. Because the $750 had already been applied to the 2023 estimated tax or refunded, the IRS billed Taxpayer J for the additional $250 owed, plus penalties and interest. Taxpayer J could not use any of the $600 that had been credited to the 2023 estimated tax to pay this bill.