Posted on 11/02/2013 11:15:27 AM PDT by Ghost of SVR4
Hello all... Any chance I can get some tax / income savvy freepers to weigh in? New job, first pay. No exemptions are showing up on my pay stub (I took it in the kiester this pay with Federal Withholding). I have three kids who live with me full time. I have a soon to be x-spouse and we are NOT filing jointly. I am in the 28% tax bracket. Is there a (relatively) easy site I can calculate what I should be getting paid? My last job's with holding was CONSIDERABLY less. My new HR rep's merely have heartbeats for their qualifications so I need to do some homework.
She lives in a different county (different school taxes) and my kids are picked up daily at my own home (i.e., it's on the School districts roster where they are at time of pickup). Not much more evidence is need than that.
Absent any history, you can:
1) for this year, take one more deduction than what you will be filing for at the end of the year. In most cases you will receive a refund but it will be small.
2) use last year’s tax software with this years information. It should give you a decent understand of your tax liability for the YEAR. Divide that by the number of pay checks and that should be how much you have taken out of your check - no more. Adjust your deductions to get close to that amount.
Understand that taxes, bonuses, deductions, credits, rebates, exemptions etc all change year to year so while a good guestimate, not all ways accurate.
3) Pay to have a tax service estimate your taxes for you. This is a fairly accurate way to get really close.
I figured you just worded it wrong. In any case, I should have read further before I replied, as three others already alerted you.
I pray she does something so stupid. My attorney subpoenas the bus driver’s company; end of story. I live rural, my kids are picked up daily in front of my home.
Claim 9 exemptions...above that your employer must report it...so
I’ve been told
There is the ADP link mentioned above but also try this. It also has a W-4 calculator.
http://www.paycheckcity.com/calculator/hourly/
You should also factor in whether you will have any pre-tax deductions like a section 125 health plan(s), contribute to an FSA or a 401k. Be careful however because 401k contributions are exempt from Federal and most state withholding (not in PA for example) but not from SS & Medicare.
Ideally you want to have enough tax withheld as to not owe anything and not so much that you get a refund. I typically do a W-4 withholding calc midyear to make sure I’m on track.
My new HR rep's merely have heartbeats for their qualifications so I need to do some homework.
FWIW, I am and have been a payroll professional for over 20 years and I will only give an employee generalized guidelines and will point them to resources to help them but I will never tell them how many exemptions they should claim as I’m not their personal accountant, may not be aware of all their personal financial situations and don’t want to give them advice that might result in them being under withheld – it’s not my job or responsibility
You corrected before I could. The more allowances you claim the less is withheld the more take home you keep. The secret is to have enough withheld to make your tax bill come April.
Yep, :-)
Find a good tax preparer who has their own business and make them your new best friend. They don’t necessarily have to be an accountant. If you have your dependents with you and you have supported (supplied their welfare) for more than half the year, you might be eligable for earned income tax credit, child tax credit and child care expense. Those contingent on child ages and your income. Again find a GOOD tax preparer who is in business year round.
This can and does often happen. You file your taxes claiming the dependents, but you have to file by mail...can’t use efile. Have proof to support your claim and duke it out with the IRS and the other party. If you have good documentation, you should be able to take the dependents and overturn the other filing.
Claim 9 exemptions
Claim nine for the greatest take home pay.
You will likely own more come tax time, but that may depend on other factors.
Keep in mind, The W-4 “worksheet” is virtually meaningless.
It is simply a guide, and “how” you get to 9 exemptions is not submitted to the IRS.
OK, First my qualifications are 10 years as a professional seasonal tax preparer.
First thing is that this is the beginning of November and by your comment you are not yet legally divorced, is that correct? By law, you marital status is what it is as of 12/31/2013. If you are not legally divorced you have problems. If you lived with your spouse any time after June 30, the best you can do is MFS and suffer or grit your teeth and file jointly. If you are legally separated and no joint cohabitation after June, and/or divorced you should be able file as Head of Household (HH). HH requires you to pay at least 50% of house costs after taking out any assistance received and you house/support your children.
So it appears to me that in the old job you were probably claiming Married status and multiple exemptions (5?) so that there was minimum withholding. If you think that you will be qualified for HH status by the end of the year, make sure that is included in your W4 computations as an added exemption. Also there are spots for adding in Child and Dependent Care Expenses as well as Child Tax Credits (all of this depends upon the age of your children). I can easily seeing you claiming 9-10 exemptions if the children are under 16.
Still remember you only have 2 months of this income on your 2013 return if you just started this job. What you do now may have to be reworked at the beginning of next year depending upon circumstances. In your shoes, I would be at a tax preparer office as soon as I had my papers in order. Even if you think your kids are your tax claims as custodial, the IRS rule is first filed gets the credit and the later filer has to dispute the claim.
Hope this helps!
The money in the account gets used in your community, you are are getting a free one year + 3.5 month loan, helps your credit rating, you now have an "emergency" fund, and you're earning interest - all for a minimum amount of effort on your part.
Watch what poor people do (i.e., don't clam any exemptions so they can get a refund in April), and don't do it.
I will add something here, you talk about bus driver route etc., that may help but the key is what address does the school have on record? How about their pediatrician? THOSE are the key records for any dispute with the IRS but filing FIRST keeps the ex from even making that initial claim.
Next, I hear you and agree with using the Ramsey plan. However, if you are computer savvy, any one of the financial programs is a great tool to have. Many of them have decent income tax calculators as well.
Granted this is a bad year for you but once you are back on an even keel, it will get better! Hug your kids and keep the shiny side up! God Bless!
.so consequently, we paid a penalty last year and our tax guy gave us voluntary quarterly tax submission forms to avoid this..
...which we didn't do..
..but we realized a few months ago that my husbands main check was taking very little out and we'd have to owe thousands....so he decreased his w2 to be less than zero to make up the difference.
...what a blow to your net income though..
It used to be true that if you claimed 10 or more exemptions or claimed “Exempt” on the W-4, employers had to send a copy to the IRS. That is no longer the case. It is I think still the case in some states that have their own withholding certificate.
I would caution however against claiming more withholding exemptions than you are entitled to claim or justify and ending up at the end of the year, well under withheld. That can result in penalties and an IRS Lock In Letter in which they will tell your employer how many exemptions you can claim, overriding any W-4.
http://www.bankrate.com/finance/taxes/understanding-underwithholding.aspx
Again the idea is to not be over withheld and get a big refund (an interest free loan from you to the government) or to be under withheld and ending up owing a lot or even worse, more than you can afford to pay on April 15th.
Ebxcellent advise. I have experienced what uninformed people do. Had one young man file and owe big time come filing time. I asked how he filled out his W4. He said 4 allowances cause thats how many dependents he had, but the ex claims the kids. I karumba...gave him a quick lesson in the purpose of the W4 and told him to run don’t walk to his HR person at work and update. It is really sad how many low level employees don’t understand payroll and the income tax picture. When I have to speak to employees at my work regarding the W4 form, I always start out by stating to the group...you pay taxes on your income...hence the INCOME TAX..because your government loves you. There is always a few people who suddenly get that startled look of..wait...what, we pay taxes on our income.
I can relate..I’m an independent contractor with my work. I have to remember to make those pesky quarterly estimated payments to cover my tax bill.
Modulo the usual “I am not a tax professional” disclaimer:
You should be able to claim at least four exemptions form withholding if you have three minor children residing with you who receive financial support (or even if any of them are full-time students under, I think 24 years of age, and get at least half their financial support from you: one for yourself, three for the children.
If you itemize deductions, you can also estimate additional exemptions from withholding on the basis of estimated deductions. If you can get a really good handle on your tax liability for the next year, you can even claim one more than the standard calculation method suggests, then ask for an additional amount to be withheld so you end up owing whatever you could conveniently pay in April (up to 10% of your tax liability, but not more to avoid penalties), rather than getting a refund.
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