I got my W-2 today. My company finally got it right and didn’t withhold NYC taxes (I may work in NYC but I don’t LIVE in NYC and should not pay NYC taxes). Denis said we have most of our paperwork in order to file and that in the next few weeks we’ll have it all and will be able to file with our accountant and get our refund back.
I also took the time to fill out a new W-4 form. In the past I’ve had zero exemptions for both federal and state. I’ve long since held the belief that I would rather get a HUGE refund and a smaller paycheck. Something about being able to take a vacation with that refund.
However, I’ve learned the error of my ways. I’m married and have two kids. I should be more concerned about paying our bills every month as opposed to taking a vacation. So, I’ve resubmitted my W-4 and included the appropriate exemptions. IRS.gov confirmed that with these exemptions we will still get a refund (albeit extremely modest) in 2006.
I then found Paycheck City, a website that helps one calculate their monthly paycheck based on the tax withholdings and extras (i.e., 401K) that you have taken out. It also confirmed that I’m doing the right thing, because my monthly paycheck is going to positively blow up in 2005.