Tax calculators are important tools to help individuals and businesses accurately calculate their tax liability. They are helpful for both simple and complicated taxes, giving individuals and businesses insight into the taxes due and helping them to make adjustments and plan ahead.

A tax calculator can provide both an overview of expected taxes as well as a detailed breakdown of various deductions and credits. Taxpayers can use these calculators to determine their taxable income, which includes income from all sources, deductions, credits and other adjustments. The calculator will take into account such factors as filing status, number of dependents, itemized deductions and the number of exemptions claimed. It will also display the various credits allowed, such as the Earned Income Credit, Child Tax Credit, and foreign tax credits.

Taxpayers can use a tax calculator to estimate their tax liability for the current year and see how any changes to their income or deductions will affect their taxes. It can help taxpayers set goals and make decisions before filing such as whether they should pay estimated taxes, make an additional contribution to an IRA, or change their withholding to get more money in their pocket right away.

A calculator can also allow taxpayers to compare the current year tax liability to the previous year's taxes. This gives taxpayers the opportunity to evaluate the tax situation before filing and make necessary changes to reduce their tax liability.

Tax calculators are a powerful tool that can assist taxpayers in understanding their taxes and in making informed decisions on their behalf. They are very helpful in ensuring that taxes are paid on time and that any deductions or credits are taken advantage of. Most major tax preparation services offer online calculators that taxpayers can use for free. Taxpayers should take advantage of these free tools in order to understand their taxes and to be as prepared as possible.