What is a W-4?A W-4 form, or “Employee’s Withholding Certificate,” is an IRS tax document that employees fill out and submit to their employers. Employers use the information on a W-4 to calculate how much tax to withhold from an employee’s paycheck throughout the year.In the past, employees could claim allowances on their W-4 to lower the amount of federal income tax withheld from their wages. The more withholding allowances an employee claimed, the less their employer would withhold from their paychecks. However, the 2017 Tax Cuts and Jobs Act overhauled a lot of tax rules, including doing away with…

The IRS offers two major options for lowering your taxable income: the standard deduction and itemized deductions. Most taxpayers opt for the standard deduction simply because it’s less work than itemizing, but that doesn’t mean it’s the right choice for everyone.What is the standard deduction?The standard deduction is a specific dollar amount that filers can subtract from their adjusted gross income to lower how much of their income is subject to tax. The IRS adjusts the standard deduction amount every year to reflect the rate of inflation.Standard deduction amounts generally depend on your tax filing status. Certain taxpayers, such as…

H&R Block’s e-filing tax products are intuitive and easy to use, and the free version offers filers a robust selection of forms. Although it’s not the most expensive of the tax software providers we reviewed, H&R Block’s online tax software isn’t the cheapest either.Still, its free version is one of the best on the market: The interface is straightforward and easy to use, and help from a human is available for an extra cost. Jump to: Full review.Free version offers a generous selection of tax forms.All paid packages include access to tax pro help at no additional charge.Well-designed and user-friendly…

TaxSlayer’s pricing model sets it apart: The company charges according to the level of support you want, rather than according to a software package’s capabilities. In other words, the cheapest paid package handles all the same tax situations and forms that the more expensive package handles — what changes is how much help you can get.If you’re a confident tax filer and don’t need a lot of support, you could save some money with TaxSlayer. Jump to: Full review.More affordable than bigger-name tax software providers.Premium and Self-Employed tiers include free tax pro support.Free version of the program has many restrictions,…

Soon after the 2024 elections results rolled in, the speculation began about what they might mean—especially when it comes to the economy and taxes. One common assumption is that a Republican victory will immediately lead to tax cuts. But if we’ve learned anything from history, it’s that what we think will happen—and what will actually happen—may be different things. While tax cuts may be in the cards, how quickly they get pushed through is uncertain. Results Earlier this week, the Republicans claimed victory in the White House and, unless there’s a surprise in the next few days, that will also…

Taxes are confusing enough without the added stress of figuring out which tax software to use. While you should get the same refund or bill no matter which provider you choose, tax filing programs typically come at a cost — so there’s a crucial difference between paying for what you’ll use and paying extra for what you don’t need. We did the research by testing and evaluating four well-known, widely used online tax providers. Our review process includes first-hand testing, information collection and user surveys, focusing on factors that are important to filers: price, ease of use, tools, tax pro…

California might have some of the highest sales tax rates in the country, and calculating how much is owed can come down to where the item is sold, what the item is and who it’s sold to. California state sales tax rateIn California, the statewide sales tax is 7.25%. However, the final price of any taxable purchase could be higher due to district taxes, which can be anywhere from .10% to 1.00%. It’s also possible to have more than one district tax applied to a purchase.California state sales tax calculatorWho pays CA sales tax?In California, sellers are responsible for calculating…

While federal tax questions have dominated the headlines this election cycle, state and local taxes can significantly impact individuals and businesses. Some ballot questions, like those involving the legalization of cannabis, have a tax bent because they would also raise revenue for states. Here’s a look at the outcomes of some of those state tax matters in the recent election. Arizona A measure in Arizona—Proposition 312—would allow property owners to apply for a property tax refund if they feel that the local government has not done enough to enforce vagrancy and nuisance laws against homeless residents. Specifically, the proposal would…

Have you ever received a payment — such as a dividend check or a bond interest payment — and noticed that 24% of the expected amount was missing? If so, you may be subject to backup withholding.This tax action can be irritating, but it only applies to certain kinds of payments and is easily fixed by making sure the IRS has correct tax information from you.What is backup withholding?Backup withholding is an action where the IRS makes payers, such as banks, deduct a 24% tax from certain kinds of payments to taxpayers who have failed to provide the IRS or…

While most Americans file taxes every year, refund expectations and plans for filing vary. NerdWallet’s annual tax survey finds that among the millions of filers, around half (55%) will file their own federal returns and 47% say they expect to get some kind of refund.The survey of over 2,000 U.S. adults ages 18 and over, conducted online by The Harris Poll, found that many Americans don’t know how much they’ll spend on tax preparation or if they’re eligible for free filing assistance. The survey also asked about approaches to tax preparation and the value of those expected refunds.Key findingsFilers may…