On tax returns, the line where it says the total of all your payments and withholding refers to something important that can result in amending the return if the amount is entered incorrectly. You can find this on your state income tax return.
In this part of your return, you’ll need to enter the total amount you’ve paid in taxes whether it be through estimated tax payments and/or withholdings. This amount refers to your total taxes paid. If the amount entered here is more or less than the actual amount paid, it will alter the tax liability and refund without a doubt. So make sure to enter the total taxes paid during the tax year correctly.
Tax liability and tax refund effected by total tax payments
How tax refunds are calculated is very simple. If a taxpayer has paid more tax than the taxes owed for that tax year, a tax refund will be issued to send the excess amount paid. This is due to how taxes are paid. Since your monthly income could be more or less than what averaged sometimes, it’s a lot more convenient to calculate taxes on an annual basis while estimating taxes and paying accordingly. This sometimes results in the total taxes paid to be more than the actual amount owed.
In that case, the tax agency – whether it be the IRS or a state/local tax department issues a tax refund. If you’re filing your return on paper, the total o all your payments and withholding is very important as even a single dollar amount mistaken can result in incorrect amounts for the rest. It’s wise to use a tax preparation service like TurboTax to file your return so you avoid any potential error on your tax return – not just with this part but everything that goes into it.