With summer ending, the end of the year will be around before you have time to figure out whether it is better to finally take down the Christmas lights or, at this point, just leave them up. That makes it a good time to look ahead on your taxes, as well as a few other financial chores.
The first step is to check your taxes, to make sure that you are not giving Uncle Sam a tax-free loan until next April 15. On the other hand, if you use your tax refund as a kind of payroll savings plan to pay off holiday bills or finance your next vacation, make sure that your refund amount is on track.
Go to the withholding calculator on the IRS website. You will need your latest paycheck stub (as well as your spouse’s, if filing jointly) and a copy of last year’s return. Use that as a guide for estimating your deductions, but make adjustments if something big has changed in your financial life. If, for example, you have refinanced your home to a lower-rate mortgage, you will have less interest to deduct. Under the Tax Cuts and Jobs Act, you may still deduct interest on up to $1 million in housing debt, as long as your new mortgage is not greater than the original loan amount refinanced. In that case, your qualifying debt is capped at $750,000.
In general, experts recommend aiming to get or owe about $100. When you are done, the calculator tells you exactly how to fill out a new Form W-4.
Speaking of taxes, if you sent Junior or Missy to day camp or some other kind of care after school let out, gather those receipts, too, because that expense is deductible under the Child and Dependent Care Credit, if it allowed you or your spouse to work. (Sleep-away camp is not…