I’ve only recently joined the working force, and I am still not sure of this entire concept.
I know I am supposed to go to an accountant and show him a slip from my job for the returns, and also slips from my stocks that show all the net changes.
What I don’t understand is \*why\* I receive a certain amount after doing all of that.
In: 8
You pay an estimated amount of taxes to the government (typically it is deducted from your paycheck each time by your employer and paid directly to the government).
It’s only an estimate that can’t take into account all the things you might do, like donate to charity, make a bunch of money on a stock trade, etc.
At the end of the year, you calculate the exact amount you should have paid, and either pay the government more money or get a refund for paying too much.
When you got your job, you filled out a W-9 (?) form where you claimed “deductions”. This is just a way to tell your employer how much you are likely to deduct from your taxes at the end of the year so that they can better estimate how much to take out of your paycheck to give over to uncle sam.
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