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You provide no detail so we can only assume you owe that or you used the estimator wrong or the withholding is low, despite what that note said.

What details would be helpful? I'm just wondering if this is normal for a company to not set a withholding in some normal vicinity by default (to owe 10k seems extreme)

>there is a disclaimer that "If you don't complete this form, your employer is required to withhold income tax at the highest default status".

That just means "withhold as single", it doesn't take into account anything else in your financial situation and there's no guarantee it will be correct for your situation.

What are box 1 and 2 on your W2?

> I went to update my W4

> "If you don't complete this form, your employer is required to withhold income tax at the highest default status".

You can't "update" a form that you've never filled in before, so which is it?

It would also depend on what kind of income you receive, what your deductions and adjustments are, and what kind of employee you are.

They would be (should be) withholding as you had last filled it out. Maybe ask how the had it keyed in last year. Did you have any gains from investments? We're you on unemployment and didn't withhold? Obviously you double triple checked for keying errors when you did your turbo tax?

You would have decided how much gets withheld (to an extent) using withholding allowances when you got hired and filled out your W4.

What is in box 1 and 2 of the w2? Is there just 1 job? Are you single with no kid?

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This was in ADP. I've never filled it out before

This was just based on entering my w-2 and I kind of panicked

>What details would be helpful?

What are Box 1 and Box 2 on your W2? What's your tax filing status and do you have any dependents

Every single job I've ever had i had to fill out a WR on my first day. Did you not do that?

You don't enter your W2, your employer mails you your W2 for the prior year in late January or early February.

I don't think so. Do you put in an additional withholding amount? and how are you supposed to know what that should be until you get your first paycheck and assume something is wrong? single, no dependents. a very vanilla case

I meant when I entered it in turbo tax it showed 10k owed. I did not go through the other steps

Well, going through all the steps is very important and changes how much tax you owe. Whats in boxes 1 and 2

What you are seeing is not normal. With 1 job, the default withholding you should not owe 10k. As to why this did happen, no progress can be made on figuring that out with the info from box 1 and 2 of your w2 form.

It’s highly unlikely you “never filled it out before.” You probably did it at onboarding, incorrectly, and haven’t updated it since.

There's your problem. TurboTax is showing what you'd owe with no deductions, no exemptions, nothing but income. TurboTax will always say you owe a ton if you've done income but not deductions.

Do you get a W2 at the end of the year or a 1099?

Take a deep breath.

Check that you transferred all the numbers from W-2 to Turbo Tax correctly. Pay special attention to which box you were copying numbers from. For example, my wages are much lower in box 1 than in box 2, because of my pre-tax deductions, so mixing them up makes my taxes skyrocket. Make sure you transferred over every number. Look for places where you reversed digits when copying or entered the same digit twice.

Check the questions about filing status, being claimed as a dependent, and whether you want to take standard deduction. Inadvertently checking the wrong box is easy, especially when cat walks across keyboard.

what does doing it "incorrectly" mean? Not requesting additional withholding?

Did you change jobs mid year?

Did you get a W2 or a 1099?

If you claim like 6 dependents when you should be claiming 0, that would be incorrect.

What are boxes 1 and 2 on your W2? You might have entered something incorrectly in TurboTax assuming you did pay the expected amount of income tax.

Taxes suck. I’ve gone through and made mistakes that gave me an initial heart attack.

Many things could go wrong. Two main ones are not including your spouse’s job on the form if you are married, or not including a second job if you are single or married.

Oh I assumed OP went past the initial income part. This is definitely what’s going on. They just need to go through the next section (sounds like standard deduction) to figure out that whatever number they see now will change significantly.

I did

I did automatically import it but thank you for your calming response

Did you enter your income from the previous job and the tax withheld from that in the portal for the new job? If not then the new job would assume your yearly income to be much less (since you started mid year) and your tax withholding would be lower than what it should be when consider both incomes.

w2

Itemized deductions got me down to 5k, still a bit concerned for next year. ~200 and 37

I'm not sure I had a place to do that, my withholding still seems wonky for this upcoming year... the old job over withheld payout and was a smaller % of wages

So you didn't actually complete your tax return? There's no way to calculate what you owe (or what your refund is) until your tax return is 100% accurate and complete.

"The highest default" doesn't mean you're going to owe $0 at the end of the year. Depending on a lot of variables, you may have to add and additional amount in step 4-c for extra withholdings.

I'm pretty sure they include the standard deduction by default because that is the minimum deduction. Thankfully I itemize 2x that and was able to get it down to 5k. The default withholding definitely seems way off. I'm a very basic case, only other missing pieces are interest/dividends and that will only increase the bill

I have a very basic situation, single, standard w2 income, some interest and dividends from savings/brokerage accounts. 1 & 2 were around 200 and 38. Default withholding seems very low

You'd have to be making $120K and single with no dependent children with only the standard deduction to be paying $20K in federal taxes. Or $160K and married with no dependent children with only the standard deduction to be paying $20K in federal taxes.

If you are making significantly less than this than something is off with your calculations.

If you are making around that much, it's time to get married and have a couple of kids! Kidding of course but it does significantly lower your tax liability.

At $120K gross, married filing jointly with 2 kids and tax credits associated with them, pre-tax deductions such as healthcare and 401K you can get your federal tax liability down to under $2000.

Seems like it is time to pay a professional $500 to do your taxes. It is likely an EA or CPA will save you way more than $500 by doing your taxes correctly, and also making sure your W4 is correct for 2023.

You only made $200 in taxable income last year? How much did you make from interest and dividends?

Box 1 on your W2 is the total amount of income you received from your employer. Box 2 is the amount of federal tax withheld by your employer.

So you are telling me you earned a total of $200 for the entire year and paid only a total of $38 in federal tax, and somehow owe $10k? I can't even begin to express how wrong your entire situation sounds.

You should check to see if you overpaid social security tax. Especially if neither job made $147,000, but the total of both jobs made more than that.

Employer payroll software have no knowledge of other jobs.

Id assume they mean 200k and 38k

The total tax liability on $200k is ~$44k, so if you had $38k withheld and still owe $10k you either have a typo in the data entry or you are grossly understating "some interest and dividends".

Echo this

One year hit the wrong letter code on my W2 and changed quite a bit

Had to go to freetax USA and start from scratch to see where I went wrong

He means $200k and $38k

This likely contributed to the issue and is so easily overlooked. I hate how easily it is to fuck yourself in our tax system. It's probably worth paying a CPA to verify just for this year for peace of mind alone.

Put last years return and this years numbers side by side best you can in an excel sheet and I’m guessing the answer will be apparent pretty quickly

Just based on everything you posted you should be paying somebody else to do your taxes

Yes, your w4 is not set up correctly for your situation. You need to fix it. How much of your pay is supplemental, bonus, rsu pay?

don't know enough particulars of your situation .. just another situation where there is an overall lack of personal financial understanding / education across all age groups ... the basic tax tables are available to check withholding information on payment statements, expand across an entire year to use as a baseline .. it doesn't account for interest, dividends, cap gains etc .. but will help prevent the once a year huge surprise .. good luck

Just under half is a bonus. Do they withhold less than normal for those?

Yes, off payroll pay can't use the algorithm, so they withhold the most common tax bracket, 22%. That's not enough for you, since you are high income. So the dollars over 100k total were seeing under withholding from 2% to 10%

At your income, running the withholding calculator at least twice a year is needed to keep on top of withholding.

Doing the taxes isn’t the problem, I’ve never been in a situation where the default withholding left me with such a high payment and I’m trying to see if others have seen something similar

I’d say i have more than a fair grasp of PF. I probably should have done some math when my first pay check came in, but I’m mainly confused as to why so little was withheld and continues to be without a special situation warranting a request for additional withholding

Thank you, this was the response I was looking for and clears that up :)

TurboTax will figure that out for you.

Married without checking the “spouse works” box.

2 jobs without doing the same.

Claiming “1” on the new form would do about $2,000 of underwithholding. It wasn’t right on the old form either, but a lot of folks had it drilled into their heads to put either “0” or “1”.

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Depends a lot on who you marry. I married someone who makes about the same as me, and we got effed on taxes. The marginal tax brackets for married people aren’t double the single brackets. We owed 8k the first year. We did just have a kid so we’ll see how much that helps.