Tax season can be something you look forward to if you receive a refund. A lot of taxpayers use their refunds to pay down debts, catch up on bills, go on vacations, cover necessities for the family, or splurge on luxuries. However, knowing just how excited you should be can be hard to predict if you don't know what to expect. Wondering what your tax refund is going to be this year? The Taxfyle calculator can help you estimate your refund. Check out these tips.
How to Use the Taxfyle Calculator
Using the Taxfyle calculator is simple, and you can choose between the simple calculator or the advanced tool. If you have income from an employer and don't itemize, the simple calculator is perfect, but if you plan to itemize, have self-employment income, or want to claim dependents, you should use the advanced calculator. Here are the steps:
- Choose your filing status. Single people usually file single, unless they have children in which case you may qualify for head of household. Married couples can choose between married filing jointly (the most advantageous choice for most couples) or married filing separately. After losing a spouse, you can file as a qualifying widow(er) for two tax years, as long as you have dependent children and haven't remarried.
- Enter your income.
- Note any income tax withheld from your income by your employer.
- Review your refund estimate.
If you want a more accurate estimate of your tax refund, use the Taxfyle advanced tax refund calculator. This calculator uses the same steps, but you also get to note your dependents. Additionally, while the simple calculator only works with employment income, the advanced tool can handle self employment and unemployment income. If you are thinking about itemizing, the advanced calculator is the way to go so that you can note itemizable deductions such as mortgage interest, charitable deductions, etc.
What You Need When You Use Taxfyle's Advanced Refund Calculator
To make your refund estimate as straightforward as possible, you may want to gather a few details before you start. For the simple calculator, you just need your w-2s (and your spouse's W-2s if you are married). If you want to use the advanced refund calculator, you need the following in addition to the W-2s:
- Your self-employment income, which consists of your business revenue and any earnings reported on a 1099-MISC minus expenses
- The total of your quarterly tax payments
- Any unemployment income you received
- Amount you paid for mortgage interest
- Charitable contribution amounts
- Medical bills paid during the tax year
- How much you spent on childcare
- Student loan interest paid
How to Estimate Your Refund on Your Own
Using a tax refund calculator is the easiest way to get an estimate on your tax refund, but you can also do an estimate by hand. Figure out your filing status and find the deduction linked to that status. For instance, if you are married filing jointly, your standard deduction for 2018 is $24,000.
Subtract your applicable standard deduction amount from your income and use the IRS's income tax brackets to find your potential tax rate. If your taxable income is up to $19,050 for a couple, your tax rate is 10%. To explain, imagine you and your spouse earned $40,000 last year. After subtracting your standard deduction, you have $16,000 left. When you multiply that by 10%, you get your tax bill of $1,600. Now, look at your W-2s and any estimated payments if applicable — any income tax you paid over that amount, you get back as a refund. That said, the IRS takes into account a number of other details as well so using the calculator to double check your work is always helpful.