Why millions of people are getting hit with a surprise tax bill this year. An effort to make the tax bill look better ended up making it look worse.
Americans who are accustomed to receiving an income tax refund tend to file their taxes early — often in late January or early February when all the paperwork becomes available — but this year many early filers are finding to their surprise that they actually owe money to the IRS.
This was all explained in a Government Accountability Office report last summer, but it turns out that many people are not regular readers of GAO reports and did not take the GAO’s official advice to check their withholding status. The result? Surprise tax bills!