The newest IRS Form W-4 provides a new process to accomplish the same goal as exemptions did in the past. In fact, the new form more clearly connects setting your withholdings with the process you will use in April to fill out Form 1040 and file your taxes.
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Filling out the form
Getting to an exact withholding number
Getting payroll estimates from HR
Assuming the withdrawal is going to be spent and not rolled over to another retirement account, a partial withdrawal from your Traditional 401(k) will be treated as taxable income when you file your taxes next year. The amount the 401(k) provider deducts and sends to the IRS will also be counted as a prepayment of your taxes for the year, similar to how withholdings worked while working. . . .
Read MoreThe IRS provides directions for filing a 1040X on their website, although as with all things IRS they aren't always the easiest to follow. I highly recommend engaging a qualified tax professional, such as a CPA, to assist you with your taxes. Additionally, since you have a significant underpayment of taxes for the prior year, you will want to have professional guidance to minimize penalties (the IRS doesn't generally lower interest charges).
Hiring a CPA is Cheap
Volunteer Income Tax Assistance Program
Minimizing Multi-Decade Taxes
Taking the Standard Deduction does not eliminate all other deductions, but it does eliminate many of the most talked about deductions. The Standard Deduction can be take instead of taking Itemized Deductions from Schedule A, but there are plenty of other deductions and tax credits which are available.
Read MoreThere are a few questions imbedded in your bigger question, so I'll be taking them one at a time. Before starting, however, you will likely benefit from talking with a financial professional, at least CPA for doing your taxes this year. To answer your main question, assuming the property was never depreciated as an investment property, your share of the capital gains will be taxed at long-term capital gains rates. This should be a tax of 15% of the capital gain above the exclusion amount.
Read MoreBased on what you have stated, your interest should still be deductible under the new tax law. Whether second mortgage interest is deductible is highly dependent on your individual circumstances, and many are confused by the new rules (as they are honestly quite confusing). You will want to . . . .
Read MoreWhile the specifics of your tax situation can't be determined without reviewing your tax returns, most likely you are just a victim of the marriage penalty. When two high-income people get married . . . .
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