If you have enough unreimbursed medical expenses, you may be able to deduct them. If you plan to itemize - or you're close to the threshold - now is a good time to prepay deductible expenses, such as mortgage payments and state taxes due in January. Unless your finances have changed significantly, you probably have a pretty good idea whether you'll itemize or claim the standard deduction when you file your 2021 tax return. In general, you don't have to worry about a penalty if you owe less than $1,000 after subtracting withholdings and credits, or if you paid at least 90% of the amount of tax due for the current year or 100% of taxes due the previous year, whichever is smaller. Then, early next year, complete another W-4 for withholding in 2022.' If it looks like you're going to owe money when you file your next tax return, the IRS tool will tell you how much "extra withholding" you should put down on Line 4(c) of Form W-4 to catch you up on withholding for the year. You'll need your most recent pay stub and a copy of your 2020 tax return to help estimate your 2021 income.
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Use the IRS's Tax Withholding Estimator as soon as you can to determine whether you should file a new Form W-4 with your employer and increase the amount of taxes withheld from your paycheck before the end of the year. If you were hit with a big tax bill this year because you didn't have enough money withheld from your paycheck, you may be able to take steps between now and year-end to avoid another April surprise.