Avoid a Tax Season Surprise: Why You Should Check Your Withholding Now

Nobody likes a surprise tax bill—or a much smaller refund than expected. But both can happen if your tax withholding isn’t quite right. The good news? You don’t have to wait until next year to find out. By checking your withholding now, you can make simple adjustments that save you stress (and possibly money) when tax season rolls around.

What Is Tax Withholding?

Tax withholding is the amount of federal income tax that’s taken out of your paycheck throughout the year. Your employer sends this money directly to the IRS on your behalf. The goal is to have just the right amount withheld so that when you file your tax return, you’re close to breaking even - owing nothing and receiving nothing.

But a lot can throw your withholding off track:

• A raise or a new job

• Side income or freelance work

• Changes in marital status or dependents

• Claiming tax credits or deductions

• Not updating your W-4 form

Why Check Withholding Mid-Year?

Doing a quick withholding check-up now gives you time to course-correct before the year ends. If you’re underpaying, you can adjust your W-4 to increase withholding and avoid penalties. If you’re overpaying, you can decrease withholding and boost your paycheck instead of waiting for a big refund.

Use the IRS Withholding Estimator

The IRS offers a free Withholding Estimator tool that walks you through your income, credits, and deductions to help you figure out the right amount to withhold. It only takes a few minutes and can make a big difference next spring.

What to Do If Adjustments Are Needed

If you find you need to adjust your withholding:

1. Complete a new W-4 – This form tells your employer how much tax to withhold from each paycheck.

2. Submit it to your employer – They’ll update your payroll settings.

3. Recheck later this year – Especially if your income or circumstances change again.

Final Thought: Plan Now, Relax Later

Tax planning doesn’t have to be complicated or time-consuming. A 10-minute check today can help you avoid headaches tomorrow. Whether you’re a W-2 employee or a small business owner juggling multiple income streams, staying proactive with your withholding is one of the smartest financial moves you can make.

Disclaimer: This blog is for informational purposes only and does not constitute legal, tax, or financial advice. Always consult with a qualified tax professional before making decisions based on your specific circumstances.