With tax season safely in the rear-view mirror, some of America’s more financially conscious citizens are already looking ahead to next year’s tax deadline. It’s not too early to start planning for a better tax season next year!
For those lucky enough to be expecting a refund, the big question mark that needs to be answered before any vacations are planned is how big of a refund to expect. While the real-life number obviously requires one to know their income for the rest of the year as well as the loss or gain of any assets amongst other factors, if one is willing to estimate those numbers then there are plenty of tax refund estimators on the web that can help you visualize the blue waters of Tahiti a full nine months before that refund check ever arrives.
In the world of taxes, the Internal Revenue Service (IRS) is pretty obviously the end all be all, and its only fitting that I place their refund estimator at the top of the list. It is somewhat more comprehensive than the other two and lacks their aesthetically pleasing layout but it gets the job done. It also allows you to enter in your total withholding amount from the year thus far and it estimates what you will pay in taxes out of your paycheck for the rest of the year.
H&R Block has been doing America’s taxes since 1955, when Henry and Richard Bloch opened their first office in Kansas City, Missouri. It made some waves when the company began to offer high-interest loans based on what someone’s tax refund was estimated to be and while Federal judges have since eliminated the program, H&R Block would still love to help you estimate your refund. The H&R Block estimator is decidedly more upbeat than the dreary domain of the IRS and it is also much, much simpler requiring only a fraction of the information the IRS asks for. But, as a result of that simplicity, the H&R Block estimator has a much larger margin of error because it asks for less information. It also has the drawback of being more or less a marketing tool for their tax preparation service which can be somewhat annoying, especially if you do accidentally give them your e-mail address.
The TurboTax estimator is hands-down the gadget with the most attractive interface, as it is a flash-based estimator that has sliders and graphics along with little help icons everywhere that display pertinent information for those wishing to understand their taxes better. It even displays your tax rate based on the information your provide! Now you can know just how far away you are from the one percent.
That being said, it, along with the H&R Block estimator, still makes the user estimate their withholding — which can lead to inaccuracies for many. If one has the exact same salary as they did last year, they can of course use the previous year’s withholding, but most people’s income fluctuates, making a solid withholding estimate elusive. But the TurboTax widget is likely just as accurate as the IRS’s estimator, as they each gather an extensive amount of information — and TurboTax’s added aesthetic value might make it the best refund estimator on the internet.
While estimating your refund can be a mentally and emotionally rewarding activity since it helps everyone imagine all those precious dollars in their bank account, it must be noted that these estimators are all built on current tax law. There are always numerous bills making their way through legislature that change different areas of tax law, from child tax credits to federal income tax brackets (which change from year to year). For some, the passage of a new tax law may devastate their refund and for others it could add thousands of dollars to it so it is best to take the numbers these estimators produce with a grain of salt.