If you contribute too little money, you might receive a sizable tax bill you weren't expecting when you file your taxes next year.
Take adding dependents, for example: They can lower your tax bill by thousands of dollars if you claim credits like the child tax credit, the child and dependent care credit or the earned income tax credit.
"Tax withheld on bonuses and stock compensation is typically — though not always — withheld at a flat 22% for federal taxes," says Carla Adams, a certified financial planner in Michigan.
However, those in a higher tax bracket could owe huge taxes."
How to check if your tax withholding is on track
Persons:
it's, Roth, Michelle Gessner, Carla Adams
Organizations:
Internal Revenue
Locations:
Houston, Michigan