Author Topic: Help with Federal Income Tax Withheld  (Read 391 times)

tophdna

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Help with Federal Income Tax Withheld
« on: January 13, 2021, 08:17:36 PM »
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!

terran

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Re: Help with Federal Income Tax Withheld
« Reply #1 on: January 13, 2021, 11:33:26 PM »

MDM

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Re: Help with Federal Income Tax Withheld
« Reply #2 on: January 15, 2021, 06:48:25 PM »
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
Payroll is not correct, unless you get a 1099-NEC instead of a W-2 to report income.

Quote
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.
Total withholding of ~$4700 would cover that situation, assuming W-2 income, no other income, no pre-tax deductions, etc.

gimmi80

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Re: Help with Federal Income Tax Withheld
« Reply #3 on: January 16, 2021, 04:15:01 AM »
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!

Very strange... very unusual for an employer. The w-4 form changed in 2020, tax deduction are now estimated in a dollar amount, not a number as they used to.
They might have sent one and you sent it back with a 0, thinking that it was 0 deduction (pay all the taxes) but it was actually $0 of tax payment

Duke03

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Re: Help with Federal Income Tax Withheld
« Reply #4 on: January 20, 2021, 08:09:46 PM »
What is your combined AGI?