FITW Increases 28% Next Year (Vanity)

DaveArk Military Retired Pay Statement | Dec 6, 2009 | DaveArk

[Kanzan]

And remember the ‘tax cut’ right after O’bama took office? It wasn’t a tax cut, it was a reduction of tax withholding. I wonder how Zippy’s useful idiots will explain that one come April 15.

[DaveArk]

Already done. Thanks.

[KarlInOhio]

And remember the ‘tax cut’ right after O’bama took office? It wasn’t a tax cut, it was a reduction of tax withholding. I wonder how Zippy’s useful idiots will explain that one come April 15.

It is a tax cut. Check line 63 on the 2009 Form 1040 and Schedule M it refers to.

http://www.irs.gov/pub/irs-pdf/f1040.pdf?portlet=3

http://www.irs.gov/pub/irs-pdf/f1040sm.pdf

It's a nightmare of paperwork for the money to make sure the "wrong" people don't get it, but the typical worker will get his taxes reduced by $400 for 2009. The withholding tables were adjusted to reduce the typical taxpayer's withholding by that $400 over the last 2/3 (?) of the year since the credit was passed.

There was recently a flurry of articles about workers with more than one job having their withholding reduced to cover that $400 on each job, thus under withholding in total.

[The Comedian]

Joe Biden says it's time to be patriotic and stop being such a racist.

Oh, and be duly appreciative that they let you keep any of it, peasant.

Frowning takes 68 muscles.
Smiling takes 6.
Pulling this trigger takes 2.
I'm lazy.

[Mamzelle]

re: I thought they didn’t expire until end of 2010?)))

I was thinking the same thing!

[gusopol3]

see his #7. I guess it’s definitive.

[Mamzelle]

If this is already impacting paychecks...this is bad news for the taxpayer but great news for 2010 elections.

[iowamomforfreedom]

Tax rates will go up for tax years beginning AFTER 12/31/10, if the tax cuts are not extended. They will still be in effect for the 2010 tax year.

Keep in mind that since withholding was reduced last spring to offset the $400 tax credit for 2009, and there is no $400 tax credit for 2010, then your withholding will go back up to what it was before it was reduced last spring.

The other thing that may increase your withholding if you didn’t see an increase in gross pay would be if you had a DECREASE in pre-tax items (such as amounts withheld for 401k, section 125 cafeteria plans, a lower amount withheld for your portion of health insurance premiums (not likely), etc. These amounts are deducted from your reported taxable wages, so if pre-tax amounts went DOWN, your reportable taxable income would go UP, therefore your tax liability would go UP, therefore your withholding would go UP.

I would check with your payroll department, just to make sure they are using the right W-4 exemption amounts.

[DaveArk]

I guess I stand corrected. It is nice to have tax increases two years in a row without any new legislation on the Democrats part.

[chris_bdba]

Nope Jan 2010 is when it expires.

[chris_bdba]

Yep the Dems convinced them that they were only for the rich which we all know was a BIG lie

[gusopol3]

See #28.

[iowamomforfreedom]

And keep in mind they have until Dec 31st to slip in more tax legislation. They ALWAYS slip something in in December. Who knows really what our tax situation will be for next year?

[DaveArk]

Yes they do “slip” those things in don’t they.

[cuba_pete]

I have already received my retired pay statement which reflects the increase of FITW for 2010. The amount nearly tripled, just a dollar short of that. I file married/joint with zero exemptions. Coupled with the 0% increase for retired COLA for 2010 and 2011, this counts as a reduction. According to the newsletter accompanying the statement, those who were married and filed jointly and worked in 2009 would see an increase in taxes under the American Recovery and Reinvestment Act. Those who don’t work pay less...those who do pay more. Make sense?