Simple Way to Calculate Federal Tax Easily

Financial health isn't something I talk about a lot on this blog, but it is very much related to physical health and I want to talk about it for a minute. Now that we are beginning the new year, and new decade this time around, we have to start thinking about our finances a bit. On that subject, we still have to pay our taxes for last year - and that scares a lot of people. My goal is to put your mind at ease a little.

Tax return forms can be very intimidating at first, but there really isn’t anything to be scared of it when you know how to calculate income tax. You should do a quick estimate so you know what to expect when you start doing the long form or go to your tax man.

When you want to figure out your taxes the first thing to do is add up how much money you made. You should have statements from your employer and any investments or interest you earned. Next you have to determine your deductions like charity and mortgage interest. Determine your taxable income by subtracting your deductions from your total income. Once you have this, look up your tax on the federal tax tables. Subtract any credits, like for children, from your tax and add any penalties to get your final tax. Hopefully you paid in more than you owe and will get a big refund.

See how easy that is. Don’t stress out so much over your financial health. When you are ready to do your taxes, check out some of the online income tax software programs. They are way cheaper than going to a tax professional.