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The basics
The first forecast year may contain fewer than twelve months. Start from the balances you hold today; the model projects the remaining part of the year.
The tax return for that year covers all twelve months. Unless told otherwise, the model assumes each income dated “now” has been coming in since January, with the tax on those earlier months already withheld, and prices the first year on that whole-year return. In Default settings, The year so far replaces that assumption with prior wages, workplace contributions, other ordinary income, and income-tax withholding from your paystub.
Illustrative numbers
An August starting point
Months remaining, including August5
Annual recurring salary$120,000
Projected remaining salary, before other adjustments$50,000
Earlier wages$70,000 assumed, or entered in The year so far
Earlier wages affect the tax calculation. They are not added to your bank balance again: today’s balances already reflect the money you kept.
Calculation transparency
How it works in MoneyWhatIf
- 01
Recurring first-year flows are prorated to the months they cover, while annual tax brackets and deductions remain annual. Some events have their own timing; an RSU vesting tranche is not simply multiplied by the remaining-year fraction.
- 02
Earlier pre-tax and Roth workplace deferrals both use the year’s contribution room. Only the pre-tax part reduces ordinary income. Earlier wages also count toward the payroll-tax wage base.
- 03
Prior federal, state, and local income-tax withholding offset their respective modeled first-year bills, each with a zero floor. Excess entered withholding does not create a first-year refund.
- 04
These defaults carry a calendar-year stamp. They apply only to a matching, genuinely partial first year; January and stale-year figures are ignored. Saving defaults does not rewrite existing plans.
Keep in mind
Model limits
The fields do not reconstruct a complete tax return or every type of income already received.
Do not add past pay or past contributions to current balances a second time.
This explanation documents the planning model. It is educational, not individualized tax, legal, Medicare, or investment advice.
Where it appears
Where to use it
See this concept in context, with a guide to each page and its controls.
The words behind it
Related financial terms
Plain-English definitions, with 2026 figures and worked examples, from the financial terms glossary.