My wages are $7050.62 and my Fed Inc Tax withheld is $117.59 It just doesn't seem right. Did I make a mstake?

Answer 1

The amount withheld is very low. Let's see. I have a few ideas for you.

1. Check your last paystub of 2006 for the year to date total of Federal taxes withheld. Make sure this agrees to the W-2.

2. If this amount is correct and assuming you were paid bi-weekly that means less than $5 was taken from each pay for Federal taxes and you should have noticed that sooner on your paystubs.

3. The W-4 (an Employee's Withholding Allowance Certificate IRS form) determines how much Federal Withholding Taxes will be deducted from your paycheck. If you have a very large number there, less taxes will be withheld from each pay. This could be the case if you have a lot of dependents. I would suggest that you check with your payroll department to see what they have on file, and fill out a new W-4 with less allowances. You can even enter an additional amount to be withheld from each pay.

4. If your W-4 is correct as far as allowances. Make sure this isn't a data entry problem. I've seen cases where an employee asked for 2 allowances, and it was entered as 20.

Answer 2

Well, if you're single and can't be claimed as a dependent by another tax payer, you don't have any tax liability if your income is less than $8,450. So the amount withheld is actually just about right.

You probably had a few pay periods where your annualized income would have been more than $8,450 if you'd earned that much every pay period throughout the year. Or you worked less than a full year. Either of those reasons would account for having any tax at all withheld.

You have NOT done anything wrong! You are just about perfectly on track actually. If your withholdings are just enough to cover your tax liability you won't get much of a refund but you WILL get the most amount of YOUR money in your paycheck each payday.

People who get huge refunds are actually making an INTEREST FREE LOAN to the government for up to a year. Personally I hate doing that and would rather pay a little on tax day than get any refund at all. That way I have MY money in MY hand ALL YEAR LONG!

Answer 3

Is that an adjusted figure? You should have had about $705 withheld from your taxes. Figure that you should have about 10% withheld if you earn under $30,000 per year, 15% between 30,000 and 50,000 then it goes up to 30%. I am not sure what the withholding increase next hits, but this is roughly what the law calls for. The reason asked is if you have already subtracted your standard deduction per the 1040 and 1040EZ, then The tax would be $708 and you will need to send the IRS some cash. Roughly the difference between the $708 and the $117.59 paid. This would be $591. If the standard deduction has not been taken out then you are looking at a minimum deduction of about $5150 per IRS Publication 17. Be sure to list the Phone surcharge refund of $30 and your EIC.as you have earned under the $12000 limit (it is a little higher than that). You cannot claim the EIC if someone else is claiming you as a dependent or you don't meet certain other criteria. Check out the 1040EZ or 1040 manual for specifics. If this is the case then you should be getting back the entire $117.59. Good luck on the taxes.

Answer 4

No. With that income, assuming you are single and take your own exemption, you have no tax liability and would get all of your withholding back. There is no particularly good reason to have excessive amounts withheld, giving the government an interest-free loan, in order to have a large refund. If, however, you wish to use your withholding as forced savings, you can change your W-4 to require additional dollar amounts held from each of your paychecks.

Answer 5

Check one of the final paystubs you got from this job for last year. Does it say you paid about $117.59 for the year? If it does then your W2 is most likely correct. If it says you have paid more then contact your employer and tell them you think your W2 is incorrect. They can verify your payment info very easily through their payroll dept and issue you a corrected W2. As many others have said, getting a small or no refund is the best financial choice even though too many Americans depend on that refund every February.

Answer 6

There must be an error there somewhere.... that's only like 1.5% tax witheld. You're poor huh? Is there anything I can do to help?