As a single person with no kids, how can I get more money out of my paycheck without FICA taking it all?

Question

I'm working my booty off at my job, but the more money I make in over time, the more FICA, State, City, and whoever wants a piece take out!

I have always claimed "0" on my w-4 form, but this is killing me. I live in Chicago where taxes are high.

I feel like I'm being penalized for being single and having no kids!!! Can I get an amen to that?

I want more of my money back in my pay without owing an arm and a thigh. How can I cut down on the deductibles?

Thank$ in Advance for advice.

Answer 1

First, make sure you are maxing out your pretax dollar investment opportunities....401K, IRA,

Second, you need to be more aware of the tax brackets.....

63K/yr & 110K are in the SAME tax bracket (28%)....Health insurance deductions can be pretax dollars....go to your personnel office to find out all the pretax benefits you can contribute to.

As a professional, there are many deductions available....your goal should be to keep your taxable income as low as possible to fall into the lower tax bracket.....

While claiming "0" - are you getting a refund...or still having to pay? Are you itemizing? or taking the standard deduction?

Finally, you need to buy real property....the deductions will benefit you greatly - it's not a dollar for dollar deduction/credit, but it could move you down to a lower tax bracket.

You should also start investing in municipal bonds....the interest is usually tax free.....some are both state & federal tax free.
maybe pay the gov't w/ their own money down the line.

Answer 2

You can't adjust FICA, but you can adjust your federal tax withholding by increasing the number of your exemptions on your W4. Just be careful that you don't end up owing when tax time comes around.

You can also try and lower your taxable income by contributing to a 401k account or by putting money in a health care spending account for your healthcare expenses.

Answer 3

You can reduce your pay, using HSA and 401k to reduce your take home now (bit you will have it set aside to invest). You can also move up your deductions if your getting too much back in April. If you can open a business and take your money into the business where you can pay legitimate business expenses that helps.
This also worked for me, got my head straight about all this money stuff. Millionaire Mind Evening
http://www.millionairemind.com/a/highnetworth?page=/preview/mme

Answer 4

Singles w/o kids basically subsidize lower taxes for people who are married and/or have kids. They talk about a "marriage penalty"..there's really one for singles. At least put down yourself as a dependent, so they don't take so much out every week.

Answer 5

On your W4 up your dependents to 10. They will take out less taxes, BUT BUT BUT this method may make for a large tax bill at tax time.

Answer 6

pre tax investments

Answer 7

more & likely youll get it all back come tax time