Why did my refund drop when I entered a second W-2? (2024)

FAQs

Why did my refund drop when I entered a second W-2? ›

Your refund meter changes as your numbers change. When you enter a second W-2, you add more income. Generally, more income means more taxes.

When you added more income, your tax liability increased, so you saw your refund decrease. The program began by giving you your standard deduction—- which lowered your taxable income. So you are not being taxed on as much of the income on that first W-2. Then you added taxable income--so the refund went down.

All or part of your refund may be offset to pay off past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or other federal nontax debts, such as student loans.

So what happens if you file twice? If you do happen to file duplicate tax returns, the IRS will accept the first tax return you submitted.

If you didn't get a notice about an offset but your tax refund is smaller than you expected, call the IRS at 800-829-1040 (or TTY/TDD 800-877-8339).

If you have two W-2s for two different jobs, you'll enter all of the relevant information from each one on your tax return when you file. That includes: Each employer's name and address. Each employer's federal identification number (EIN)

Share: Regarding filing an amended tax return, if you've already filed your return, you can't add another W-2 to your return. Instead, proceed by filing form 1040X to amend your return. Mail the completed 1040X to the IRS. Was this topic helpful?

There are many events that may reduce your refund, including: Starting an additional job (especially self-employment) Getting a significant raise, but your W-4 staying the same. Selling stock, crypto, or other investments.

When you pay your TurboTax fees with your federal refund, the TurboTax fee plus a separate Refund Processing Service (RPS) fee are deducted from your total refund amount. So your IRS-issued tax refund might be less than the amount shown in TurboTax.

If you claimed 0 and still owe taxes, chances are you added “married” to your W4 form. When you claim 0 in allowances, it seems as if you are the only one who earns and that your spouse does not. Then, when both of you earn, and the amount reaches the 25% tax bracket, the amount of tax sent is not enough.

What happens if I file one W-2 and not the other? ›

All tax forms are sent to both you and the IRS. When you file a tax return the IRS matches the forms up with what you report on your tax return. If something is missing (and a computer will always catch a W-2), then they'll send you a notice and also a bill for anything you owe.

There is nothing wrong with having two or three W2 jobs. Your bosses have no reason to object unless one interferes with the other. Rather than sneak around, tell your primary boss that you need more income, that you're thinking of taking a second job, and want to make sure that they don't see any conflict.

After your first W-2 is entered, it will be displayed on the Your Wages (Form W-2) screen. On that screen, you'll be asked if you need to enter any more W-2s for wages and salaries. Click Add a W-2, and you can enter another W-2. Repeat the process until you have entered all of your W-2s.

If you owe money to a federal or state agency, the federal government may use part or all of your federal tax refund to repay the debt. This is called a tax refund offset. If your tax refund is lower than you calculated, it may be due to a tax refund offset for an unpaid debt such as child support.

There are lots of reasons why this might happen. In most cases, the IRS takes part of your refund to pay for outstanding government debts you might owe. These include: Overdue federal tax debts.

This can be due to withholding more tax than you owe from your regular paychecks or overestimating your self-employment taxes. Qualifying for a refundable tax credit may also contribute to your refund amount. When a refundable credit amount exceeds the tax you owe, you receive the leftover credit as a refund.

This is because of the graduated nature of the tax rates, which applies higher tax rates to higher income rates. This is how the marriage penalty might get you: when you combine incomes on a joint return, some of that income can push you into a higher tax bracket than if you were filing as the Single filing status.

If you filed your taxes and forgot to include a W-2, you should immediately file an amended return and include the W-2. The process is relatively simple. You can file it yourself or have a professional file for you.

Why is that? Generally, this happens when certain credits are involved - most commonly the Earned Income Credit (EIC). At certain income levels, the amount of EIC will fall as your income decreases. So, with each business expense, you are reducing your taxable income, which will then reduce the amount of your EIC.

If you forget to include a W-2 when you file your taxes, you may still get a refund if you are due one. However, if you owe taxes, the IRS will send you a bill for the taxes you owe.