Know the truth about online tax calculators before you file your personal taxes this year.
Can you trust the results from online tax calculators? Many people find themselves wondering the answer to this question as they prepare their taxes. If you’re like most taxpayers, you don’t have the foggiest idea how much you’ll owe before you finish filing. After all, tax rules and regulations change all the time. Knowing your personal tax burden before the deadline could help get all your ducks in a row. But is an online calculator the answer? Here’s what you need to know before you start entering the numbers.
Calculators Only Guesstimate Your Tax Burden
Some people know how much they owe each year because of income consistency. However, maybe life changes, such as getting married or having a baby, will affect your total due this year. Searching the internet for a tax calculator to determine precisely how much you’ll owe seems tempting, but it won’t be accurate.
Calculators can provide an estimated guess of how much you’ll owe Uncle Sam. As you enter your figures, the calculator will run the numbers through a series of algorithms. While you may get a ballpark figure, you won’t know your exact burden until you file.
Double Check Your Numbers
Remember how excited you were when the math teacher would let you pull out a calculator for a test? Of course, having access to the magical device wouldn’t ensure you found the right answer. Human error is, well, human. When entering your figures into an online tax estimator, you need to make sure your data entry is correct.
Before you start plugging in your numbers, make sure you have all your tax documents in front of you. Double-check each total before moving on to the next entry. Leaving off a zero or misplacing a decimal will have a profound impact on your results.
Not All Calculators Are Equal
Doing a quick Google search for tax calculators will bring up millions of results. Yes, millions. Which one should you trust? Entering numbers into three different calculators could give you three completely different totals. Unfortunately, there’s no good way to weed out your options. And you won’t know which was most accurate until you file.
The only online calculator you can trust is the one from the IRS. But even they only call their withholding “calculator” an estimator. The IRS tax withholding estimator is useful if you want to see how much you should set aside from each paycheck. It can also help you prepare for tax day. Since the IRS regularly updates their calculator, it’s the most accurate.
Tax Professionals Do It Best
The last thing you want to do is fumble through your taxes and end up with an audit letter in the mail. While online calculators can help you prepare throughout the year, they don’t hold a torch to tax professionals. Since every situation is different, you need personalized service from an expert.
Incompass Tax, Estate & Business Solutions has three decades of tax preparation experience. We take pride in providing our clients with honest, reliable, and accurate service. When you bring in your tax forms, we’ll crunch the numbers with ease. If you qualify for any money-saving deductions, we’ll let you know that as well. Best of all, we stand behind our work. Connect with us online to learn the many ways we outperform online tax calculators.