Want to Apply Your Tax Refund to Next Year’s Estimated Tax? It’s Possible

 

Expecting a refund and want to get ahead on your future taxes? While most taxpayers receive their refund in cash, you’re not required to go this route.  Instead, you can apply your tax refund to next year’s estimated taxes.

If you do choose to apply your refund to next year’s taxes, the refund amount will apply to the first estimated payment until all of the refund has been used.  Using your tax refund this way might help you reduce the burden of setting aside money to pay your estimated taxes.

Not sure you want to use all of this year’s refund for your estimated taxes?  You can always choose to partially apply your refund to next year.

How Do I Know If I Applied Part of 2018’s Refund to My 2019 Taxes?

Not sure if you applied last year’s tax refund to this year’s taxes? We can help. Use the instructions below to find out if you applied your refund to the next year (this year) and how you should report the amount when you do your current taxes.

Look at your 2018 federal return to see:

  • If you had an overpayment (refund) that was applied to this year’s estimated payments
  • How much, if any, that amount was

Report the amount on your 2019 Form 1040, Schedule 5, line 66. Don’t include in the amount:

  • Any overpayment you received as a refund
  • Any balance due from last year’s return that you paid in 2019

Related Topics

Related Resources

IRS Notice CP01C – We Verified Your Identity

Your personal information was stolen, but the IRS has verified your identity. Learn more about IRS notice CP01C from the tax experts at H&R Block.

Local And State Tax Refund Taxable

Did you receive Form 1099-G? Learn about your local and state tax refund and if it is taxable from the experts at H&R Block.

IRS Letter 2273C – Installment Agreement Accepted

Learn more about letter 2273C, why you received it, and how to handle an IRS 2273C letter with help from the tax experts at H&R Block.

Beware of IRS Fees When You Can’t Pay Your Taxes

Many IRS payment arrangements come with fees. Learn how to pay the lowest fee when setting up a payment plan or offer in compromise with the IRS.