Irs Federal Income Tax Paycheck Withholding Calculator 2009, 2010
How much will I take home after tax withholdings?
Are you withholding enough—or too much—from your paychecks? This valuable tool looks at your entire tax situation, including your other income and expenses, and figures out what you’ll actually owe on your taxes for the year. The calculator then determines how much you should have withheld to cover what you’ll owe for the year, without giving Uncle Sam a big loan.
How do I know if Iʼm withholding too much or too little?
By filing a W-4 form with your employer, you can adjust how much is withheld from your check. The bottom line is, the more allowances you claim, the less is withheld. If you donʼt claim allowances, more will be withheld. This is based on your marital status, how many children you have and there are other situations where you claim additional allowances.
There are tests for determining if sufficient taxes are being withheld from your pay. Your wage withholdings plus estimated tax payments should equal the lesser of 90% of your current tax liability or the required percentage of the prior yearʼs tax.
A percentage of your income is withheld from your pay check based on your W-4. Whether you claim yourself, your spouse, dependents or other allowances will determine how much tax is withheld from your check.
You may have other allowances like, the child tax credit, the child and dependent care credit, education tax credit, adoption credit, retirement savings credit and these mentioned here are just a few of the many credits you may be able to claim.
If you are self-employed or have large investments you may want to increase your withholding so you donʼt have to pay so much at the end of the year. You have the choice concerning what allowances you choose to claim. You can even request your employer to withhold a determined flat amount.
You have to weigh the loss of use of your earnings during the year against the large income tax return check at the end of the year. You may want to have a little more money in your pocket as you receive each check.
You can use the free tax calculators from TurboTax to determine how much you should have withheld.
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