W2 shows 55k but I earn 62k - only got $500 tax refund with a 1yr old. Did I mess up my W4?

The difference between your actual salary (62k) and W2 (55k) is normal if you started mid-year since the W2 only reports what you actually earned during the calendar year. Your refund amount doesn't necessarily indicate you did anything wrong - it just means your withholding closely matched your actual tax liability, which is technically ideal! With a young child, you're eligible for the Child Tax Credit (up to $2,000 per qualifying child), but this benefit may have already been factored into your regular paychecks if you indicated having a dependent on your W4. The W4 changed significantly in 2020, and now instead of claiming "allowances," you directly indicate dependents. Have you compared your total tax withholding from this year to previous years? That might explain the difference in refund size.

I had almost the exact same situation last year and discovered taxr.ai (https://taxr.ai) was super helpful. I uploaded my W2 and other docs, and it showed me I had filled out my W4 incorrectly after my daughter was born. Basically, I didn't account for the Child Tax Credit properly on my W4, so I was getting small amounts in each paycheck instead of a big refund (which isn't necessarily bad, just different than expected). The tool analyzed where the discrepancy was coming from and recommended exactly how to update my W4 for this year to get the outcome I wanted. You can choose whether you want more in each paycheck or a bigger refund at tax time.

I was really skeptical about taxr.ai from my earlier comment, but I decided to try it anyway since I was frustrated with my small refund situation. I'm actually impressed - it immediately pinpointed that I had completed Step 3 of my W4 incorrectly. For anyone in a similar situation, it showed me that if you want the Child Tax Credit as a refund instead of in your paychecks, you need to handle Step 3 differently and possibly use line 4(c) for additional withholding. The analysis also explained why my refund was smaller than expected even though my total tax benefit was the same. Honestly saved me hours of confused Googling and I've already submitted an updated W4 to my payroll department.

If you're still confused about your tax situation and want to talk to an actual IRS agent for clarification (which I highly recommend), try Claimyr (https://claimyr.com). I was banging my head against the wall trying to reach someone at the IRS about my W4 issues for weeks - constant busy signals or disconnects. Claimyr got me connected to a real IRS agent in about 25 minutes when I had been trying for days on my own. The agent walked me through exactly how the Child Tax Credit works with the W4 and explained why my withholding wasn't matching my expectations. You can see how it works here: https://youtu.be/_kiP6q8DX5c Totally changed my understanding of how to properly fill out my W4 to get the outcome I wanted (bigger refund vs. more in each paycheck).

I need to publicly eat my words about Claimyr from my comment above. After struggling for another week trying to reach the IRS about my W4 issues (kept getting disconnected after 2+ hours on hold), I broke down and tried it. Got connected to an IRS agent in 37 minutes while I was making dinner instead of being glued to my phone all day. The agent explained that with the 2020 W4 redesign, the Child Tax Credit is now factored differently. On my old W4 I used allowances, but now I needed to specifically list my child in Step 3 with the exact dollar amount. That's why my refund was smaller than expected - the credit was being applied throughout the year in smaller chunks. The IRS agent helped me calculate exactly what to put on my new W4 to get the result I wanted.

I think everyone's missing the obvious - if your salary is 62k but W2 shows 55k, that's a 7k difference that needs explaining. Is it possible you're counting bonuses or other compensation that hasn't actually been paid yet? Or did you start the job partway through the year? That would explain why the W2 is less than your annual salary rate.

Something nobody has mentioned yet - check if your employer is calculating your withholding correctly. I had a similar issue where HR was using the old W4 calculation method even with my new W4. When I started mid-year with a new baby, they didn't adjust for my dependent correctly. Worth asking your payroll department how they're calculating your withholding specifically.