If I withhold less taxes from my W-2 to help with my mortgage payment, will it hurt me at the end of the year?

Answer 1

You'll either get a smaller refund, or have to pay. If you have to pay, depending on the amount, you might be subject to penalties and interest. But if you've been getting a large refund and just want to cut that down, no problem - otherwise you're lending your money to the government interest-free all year, which doesn't make much sense.

Answer 2

If this is your first year of your mortgage, you can raise your exemption by 1. You'll get a little bit more money in your paycheck.

If you have had your mortgage for over 1 year, check last year's federal tax returns to see how much money you got back. If it's under $1000, don't change your exemptions. If it's more than that, then you can increase your exemptions. The rule is for every exemption on your W-2, it will increase your yearly net pay by $800. So, if you got back $4000 last year, I would increase the exemptions on the W-2 to 5, so you would get $3200 more in your yearly net paycheck, or $266 more a month.

Answer 3

If you are in that situation you probable can't afford the mortgage. Generally your mortgage should not exceed 40% of your gross income minus car payments. The less you withhold, the less you will have at end of year. If you have underpaid you may be subject to a penalty

Answer 4

Probably. Your tax will be your tax at the end of the year, and if less is withheld, the likelihood you'll have to pay rather than get a refund is increased.

Answer 5

If you withhold less taxes from each check you will get less back at the end of the year.

Answer 6

You do not have to pay Federal Income Tax. There is no law on record saying that you do. You only have to pay on Capital Gain. Your Income is trading goods for service.You must, however, file a return. Exempt is your answer!!!

Answer 7

Yes, because you'll have to pay those taxes when you do your taxes for 2006.