Estimating the amount of my 2018 tax refund

Question

I'm 23 and 2018 is the first year that I have worked full-time. I began working full-time in May of 2017 and got back about $5,500 from that tax refund (state & federal).

I'd like to get a rough estimate of what my 2018 tax refund will be. Last year I worked for 6 1/2 months or about 54% of the year. If I simply add the missing 46% of 2017 to the 2017 tax return amount, would that be a good estimate for what my 2018 tax refund will be? That would be around $8,030 ($5,500 x 1.46). I realize that taxes aren't that simple but I would like an approximate number. My pay has not changed and I have no new loans or major purchases.

I've looked into using the online tax return calculators from sites of H&R Block and Turbotax but they ask too many questions that I don't know the answer to and I don't want to spend a significant amount of time trying to figure it out. My parents have done my taxes in previous years and I want to learn bout this so I can do them myself in the future.

If posting my YTD amounts for federal or state withholding would help, I wouldn't mind.

EDIT:

Estimated total income for 2018: $52,000

Estimated total federal withheld for 2018: $9,000

Estimated total state withheld for 2018: $2,500

Estimated total student loan interest paid for 2018: $700

Estimated total contributed to 401(k) for 2018: $1,600

I file individually, single, and not a dependent.

Answer 1

The simplest method is to take your gross taxable pay (after retirement, medical, and other pre-tax deductions), and extrapolate that out to the whole year (e.g. multiplying a monthly paycheck by 12). If your pay is irregular, you might take an average of the months to date and use that to extrapolate. Be sure to include any one-off items like bonuses.

Then plug that number into an Income Tax Calculator, or use the brackets (you'll need to subtract exemptions and credits first) defined by the IRS Tax Tables to calculate your tax liability.

Then, use the same method you used for income to calculate your estimated withholding for the year. Subtract that from your tax liability to get your tax due. If the withholdings are greater than the tax liability, you can expect a tax refund.

EDIT

Using the numbers you provided:

Estimated total income for 2018: $52,000

Estimated total federal and state withheld for 2018: $11,500

Your total taxable income would be $52,000 - $12,000 (standard deduction) = $40,000, and your total tax due would be $4,734 (using the IRA tax tables). Since you've withheld $9,000, you would get an expected refund of about $4,300.

Answer 2

I'm going to add something that you did not ask -

This is what the tax table looks like. For a single person, you have the $12K standard deduction (as D noted) and a taxable $40,000.

Interesting to me, this is just over the line where rates change. In other words, the last $1300 is taxed at 22%, vs 12% for the amounts from $9K-$38.7K. This is the time to start to think about saving for retirement. It seems far off, but my wife and I started saving right out of college, and I was able to retire at 50. If that's not appealing to you, you can always keep working, but never worry about money.

I suggest you read up on how to invest, and if the numbers you offered are correct, $1300 to a traditional, pre-tax IRA, and $4200 to a Roth IRA. This will lead to a mix of both accounts which will benefit you in the future.

In response to OP's comments, I'll add - We have no details on your 401(k). If there is a company match, I'd recommend depositing to get the full match. If not, I'd use IRAs for retirement savings. Also, if there's a match and the 401(k) deduction is pushing you into the 12% bracket, I'd see if there is a Roth 401(k) option. There are many Q&A here that address IRA, Roth IRA, 401(k), Roth 401(k), etc. In my opinion, ideally you are using pretax saving to avoid the higher, 22% bracket. And post-tax to fill Roth accounts at a 12% 'cost'.

Answer 3

The reason your tax return was fairly large in 2017 is because you only worked half the year. I would expect a much smaller return for this year because you worked the whole year.
Your tax withholdings are calculated on a per paycheck basis, as if that paycheck was your regular paycheck throughout the year. So assuming you get 26 paychecks of $2k, your employer withholds 1/26 the taxes on an annual income of $52k. Last year assuming you got 15 paychecks your employer would have also withheld 1/26 of the taxes on an annual income of $52k. But your income was only $30k.