The Top 6 Reasons You're Going To Owe Money In Taxes This Year

Although some of us look forward to a tax refund each spring, many of us are going to get an unpleasant “balance due” surprise after we file taxes.

According to the IRS, 18.6 million individual Americans reportedly owed the agency a combined $360 billion in overdue taxes in 2022. Ideally, you should not be getting a large bill or a big check from the IRS.

“The goal with taxes is to not overpay or underpay,” said Tiffany Watson, the CEO of All Aboard Financial, a virtual accounting and financial consulting firm based in Tampa, Florida. “So if you can, you tweak it so that you can get it just right where you don’t expect anything back or you’re not paying the IRS ––That’s the sweet spot.”

You don’t want to be caught off-guard with a hefty bill after filing ― especially with no understanding of why. Here are the most common reasons people may owe money to the IRS after filing taxes this year:

1. You didn’t adjust your withholdings after a major life change.

The most common reason why taxpayers end up owing money to the IRS is because they did not have enough money taken out of their paychecks throughout the year, according to tax experts.

When employees first start a job, they fill out a W-4 form, which determines how much money is withheld from their paychecks for taxes. But you are supposed to update your W-4 after every major life change like marriage, divorce, the loss of a spouse, the birth or adoption of a child, a new home, or getting a second job, because those life events can immediately impact the taxes you’ll owe.

“What I usually see is that people just don’t make adjustments. They do it that one time, and then it’s like ‘out of sight, out of mind.’ But whenever you have a life change, you should be