That's probably not the question most people want to think about. The fact is, folks usually know if they are in the "refund" group, and want their money as soon as possible, or the "payment" group and hold off the tax filing issue as long as possible until mid-April. However, it's just delaying the inevitable. And, knowing exactly where you're probably going to land now in January, gives you another almost three months to do something about it.
How to figure out if you're going to owe and how much? That's easy. There are a number of tax software companies online who literally give you free tools to run basic scenario calculations. I did mine on H&R Block as soon as I got my W-2 today from my employer, estimated and added in my extra income from freelancing, posted all the plausible deductions I know right off the top I have, and cranked out the numbers. In about 5 minutes, I now know I probably owe something between $1,000 and $1,200 in additional taxes. Now I've got three months to come up with it before due, and I have a reasonably good idea what my exposure is.
However, I knew this was coming after doing my taxes for probably 20 something years, and having had to pay something at least in the last five. So, with that knowledge, I already saved $1,300 from some extra money I made at the end of the year last year. In effect, I might have a bit left over instead of having to scramble and come up with anything. The fact is, though, having the working knowledge ahead of time is so much better than figuring out, in shock, that I owe a huge amount on some late date like April 1. Seriously, how fast can someone come up with an extra $1,000 or $1,500 in ten days? Probably not that many of us.
Do yourself a favor and do a dry run, test trial of your tax filing now. Here are some free calculators where you can figure out your bracket as well as come up with a likely figure of whether you owe, or will get a refund.
- https://turbotax.intuit.com/tax-tools/calculators/tax-bracket/
- https://www.nerdwallet.com/taxes/tax-calculator
- https://www.bankrate.com/taxes/quick-tax-rate-calculator/
- https://www.efile.com/estimate-tax-refund-for-2022-return-calculator/
