[Poll] Single filers with no dependents earning $60k-75k annually - what's your typical tax refund amount?

Thanks for the explanation! I've been getting around $1,200 back the last couple years. I contribute about 8% to my 401k. Is that "normal" for my income bracket or should I be adjusting something?

The $1,200 refund amount is actually pretty reasonable for your situation. That's about $100 per month in overwithholding, which isn't excessive. Your 401k contribution is definitely helping reduce your taxable income, which is great for retirement savings and tax purposes. If you wanted to get closer to zero refund (and have slightly higher paychecks), you could adjust your W-4 to withhold a bit less, but honestly, some people prefer a small refund as a form of "forced savings." As long as you're not getting massive refunds, your current setup seems appropriate.

Wait how does this work? Does it actually look at your paystubs or something? I get around $1,800 back each year but never really thought about changing my withholding.

Sounds like yet another tax prep service trying to upsell me. I've used free filing for years and been fine. What makes this any different from TurboTax or H&R Block's free calculators?

It analyzes your actual tax documents and paystubs to give personalized recommendations. It's not just using generic tax brackets - it looks at your specific situation, including retirement contributions, other deductions, and exactly how much is being withheld. That's how it caught that I was overpaying each month. The main difference from free calculators is it's not trying to get you to buy tax prep services. It focuses specifically on optimizing your withholdings and explaining how different choices affect your money throughout the year. It showed me I could have an extra $175 in each paycheck instead of waiting for a refund.

How does this actually work though? I don't understand how a third party service can get you through to the IRS faster than just calling them yourself? Seems fishy.

Yeah right, no way this works. The IRS phone system is completely broken. I've tried calling dozens of times about my refund amount and never gotten through. If this actually worked, everyone would be using it. Sounds like a scam to me.

It works by using their system to navigate the IRS phone tree and wait on hold for you. Basically, they call and wait in the queue, then when they finally get through to an agent, they connect the call to your phone. So you don't have to waste hours listening to hold music. The reason it's effective is that they have technology to deal with the constant busy signals and disconnects that happen when you try to call directly. They keep redialing and trying different numbers until they get through. I was skeptical too, but when you've been trying to reach someone for weeks with no success, it's worth trying something different.

Do you do anything special on your W-4? I make about the same ($69k) with similar 401k but only got back $780 last year. Trying to figure out if I'm doing something wrong.

I don't do anything special on my W-4. I just select "single" filing status and don't claim any additional withholding allowances. The difference might be that I live in a high-tax state (NY), so I get a decent state refund too which might skew my perception of my total refund. Another possibility is that your employer might be withholding differently than mine. Some payroll systems are more accurate than others. If you have any side income or investment dividends, that could also reduce your refund if you're not having enough withheld to cover those additional income sources.

You definitely need to account for side gig income separately. Your W-4 from your main job only calculates withholding based on that income. For side gigs, you should either make quarterly estimated payments or increase withholding from your main job to cover the extra income.

Thanks, that makes sense. I didn't realize my main job withholding wouldn't automatically cover other income. Do you know how I should calculate how much extra to withhold? Is there some percentage of side income I should be setting aside?

A good rule of thumb is to set aside about 25-30% of your side gig income for taxes (this covers federal, state, and self-employment taxes). So for your $4k side income, you'd want to save around $1,000-1,200. You can either make quarterly estimated payments to the IRS or increase your withholding from your main job by having an extra $80-100 per month taken out. The IRS has a withholding calculator on their website that can help you figure out the exact amount based on your total expected income.