I owed an additional $1,249 in taxes for 2023. I did not have the benefit of 401k contributions so all of my W2 income was taxed. I also had almost $2,500 in interest income. I ended up paying approximately $30,300 total in taxes in 2023.
That's definitely a lot of money. I am on the hook for quarterly taxes for 2024. I don't think I will owe much, if anything, in 2024 as I will have the benefit of my 401k contributions to offset my taxable income.
This was a good lesson to plan for taxes. I don't know anything about tax shelters or ways to decrease taxable income, other than retirement contributions. I would like to research this topic so I can have a better understanding of planning for possible future tax bills.
Anyone have a surprising tax bill this year? Anyone ever have to look into (legal) ways to decrease taxable income?
