A thought crossed my mind recently and I was wondering if someone could explain if I'm missing something, and if so what.
Simply put, as an individual filing taxes (single, no dependents), taking the standard deduction, working the same job each year with the taxes taken out of each paycheck, shouldn't I have a zero tax balance when I complete my 1040 ?
This stems from the (possibly incorrect) assumption that my work is withdrawing taxes from each paycheck correctly. If that is true, shouldn't I be all paid up at the end for the year?
I was discussing this with a friend recently, and we couldn't see the flaw, but I am sure I am missing something because, frankly, it sounds too good to be true.
So if a single person takes the standard deduction for their US taxes, works the same job all year, has no tax credits/penalties, but somehow still get a refund or owes additional taxes, does that necessarily mean that their paychecks were off? Or is there something else I am missing?