I just recently discovered that my job had stopped taking federal income tax out of my check in may of last year. After speaking with payroll they informed me that this is what IRS prefers and I need to calculate what I need taken out so I essentially have a $0 return. I was hoping to post my numbers here and see if someone could help me calculate the dollar amount I need to withhold from my check each month. Here are the details:
Resident of the State of Texas (no state income tax)
Family of four, wife and I both work, children are currently 2yo and 8month old.
Husband Annual Salary (paid once a month): $56,557.92
Wife Annual Salary (paid once a month): $51,350.95
Net Income: $107,908.97 for the year
It appears they take $193.05/check out of my wife's check for federal income tax which equals $2,316.60/year for federal income tax.
For Daycare for both kids we will pay a total of $~23,400 by the end of the year.
That's about everything we would get for tax credit. I usually file a pretty simple return and choose the standard deduction. I've just never had to depend. on figuring out what I have to take out of my check for federal income tax. I'm pretty much screwed for 2020 taxes (my fault for not paying attention) but would definitely like to right this ship as soon as possible.
thanks in advance for your help!