Assuming these are monthly figures, I think you're overestimating your federal tax liability.
Quick estimate:
Annual income minus 401(k) contribution: $4,719.41 * 12 = $56,632.92
Standard deduction: $12,600
Four personal exemptions: $12,000
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Taxable income: $56,632.92 - $12,600 - $12,000 = $32,032.92
Base tax: $18,450 * 10% + $13,582.92 * 15% = $3,882.44
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Saver's credit: $2,000 (your contribution) * 0.1 = $200
Child tax credit: $2,000
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Tax after credits: $1,682.44 ($140.20/month)
I'm ignoring the rental property here because the rent isn't that high to begin with, and you should probably have enough deductions from mortgage interest, depreciation, and other expenses to offset most (if not all) of the rent.
You should increase your allowances on your W-4 to the point where you get around $150/month withheld (or less, if you implement the suggestions below).
A few observations/questions:
- If you contribute at least $2,000 to an IRA for your spouse, you'll get an additional $200 of saver's credit.
- If you max out your pre-tax 401(k), you'll likely become eligible for the earned income credit. The amount could be up to $800 based on last year's tables, would be a bit higher this year because of inflation. However if your rental and any other taxable investment income totals more than $3,350, you'll get no earned income credit.
- With PMI, you could probably benefit from refinancing to get rid of it, but you would have to bring some cash to the table to get a high enough equity ratio. Are all of your investments in retirement accounts, or do you have some easily accessible money that you could put down at closing to rid yourself of PMI?
- Your rental seems to be cash flow negative, with the rent barely covering the mortgage and a $100 "sinking fund" on top of that. Are you sure you want to keep it? Seems like managing a rental plus two kids plus a farm is a lot to deal with, so consider ditching the rental unless you have a very good reason not to.
Personally, my top two priorities would probably be to increase retirement contributions and get rid of PMI. I would probably go with the retirement accounts first because of those tax reasons (saving 15% on the contributions plus an additional $1,000 or so in tax credits is a nice deal!), but if the PMI is really expensive you may want to try and knock that out this year and go full steam ahead with the retirement savings next year.