Just started a new job and noticed I’m not being federally taxed. I’ve held this position before while I was married, and now I’m back between Accounting internships. Payroll says I’m not being taxed because I earn less than $1,154 bi-weekly and is treating me as married filing jointly. This doesn’t seem right to me! When I held this same job three years ago, I was always federally taxed. Plus, my wife, who often makes less than $1,154, still gets taxed. Should I leave things as they are and benefit from the extra cash, or should I request additional withholding? Is payroll’s assessment accurate?
Edit: I’m a W-2 employee.
One response
It sounds like you’re in a bit of a confusing situation regarding your federal tax withholding. Here are a few points to consider:
Withholding Allowances: When you worked this job before as a married person, your tax situation may have been different due to changes in tax laws or your personal circumstances. If your payroll department is basing your withholding on your filing status and the income you receive, and if you indicated that you’re married filing jointly, they may have determined that withholding is not necessary based on your income level.
Income Level: The threshold of $1,154 per bi-weekly paycheck that you’ve mentioned could be related to the IRS withholding guidelines. Essentially, if your income is below a certain level, they might not withhold federal taxes. However, anyone with any income can be subject to withholding.
Previous Experience: Since you’ve been taxed federally in the past, it might be worth double-checking your current withholding status. Payroll could be interpreting your situation incorrectly.
Extra Withholding: If you would prefer to ensure that you’re meeting your tax obligations or want to avoid a potential tax liability at the end of the year, you could choose to have extra withholding from your paychecks. This can give you more peace of mind.
Consult Payroll or HR: It’s a good idea to reach out to your HR or payroll department to clarify your status. You can ask for a review of your withholding based on your current situation and express your concerns about federal taxation.
Tax Professional Advice: If you’re unsure of what to do, consider consulting with a tax professional who can provide personalized advice based on your specific circumstances.
Ultimately, while you might appreciate the extra take-home pay, it’s essential to be informed about your tax obligations to avoid surprises when tax season comes around.