If you're expecting a refund, you don't have to receive the entire amount as a payment. You can choose to apply all or part of your refund to next year's taxes instead.
For some taxpayers, this can be a convenient way to get a head start on next year's tax bill, especially if they make estimated tax payments throughout the year.
Why would I apply my refund or overpayment to next year's taxes?
- Your refund amount is small and you would rather put it toward next year's taxes.
- Your refund is larger than usual and you want to reduce future tax payments.
- The filing deadline is approaching and you make estimated tax payments during the year.
Where do I enter an overpayment or refund applied from last year?
If you applied all or part of your prior year's refund to your current year's taxes, you'll need to enter that amount in the program so your return is calculated correctly.
Follow these steps:
- Go to Federal.
- Select Payments & Estimates.
- Choose Federal (or State) Estimated Tax Payments.
- Enter the Amount Applied from Prior Year Refund.
How do I apply part of my refund to next year's taxes?
State refund
- Go to State.
- Select Payments.
- Enter the amount of your state refund that you want applied to next year's state taxes.
Federal refund
- Go to Federal.
- Select Payments & Estimates.
- Choose Apply Overpayment to Next Year's Taxes.
- Enter the amount of overpayment you want applied to next year's federal taxes.
Can I change my mind later and get the refund instead?
Generally, no.
If you elect to apply a federal refund or overpayment to next year's estimated taxes, the election generally becomes irrevocable after the due date of the return. This means you typically cannot amend the return later and request that amount as a refund instead.
Before making this choice, consider your expected tax situation for next year and whether you would prefer to receive the money now or use it to reduce future tax payments.