Is it true that people who work two jobs are taxed a lot more than others?

Question

I am in financial dire straits right now, I don't even have enough money to pay my cell phone bill or rent this month. Is it ok for me to work two jobs, just until I get back on my feet? I really can't afford high taxes, not now, and probably not next year when I have to file my taxes. Thanks every in advance for your help. P.S. I am really looking for serious answers, preferably with concrete proof to support it. Thanks again!

Answer 1

You pay taxes on your total income not based on how many jobs that you have. Making more money might cost you more in taxes because you can end up in a higher tax bracket. http://www.irs.gov/formspubs/article/0,,id=164272,00.html If you review this link you can determine approximately where you'll fall in the tax bracket. Based on that you can estimate. I wouldn't worry that you'll end up in a high tax bracket because you'd have to make more than $77,100 to have that problem. Good luck.

Answer 2

Well.... if you work one job the whole year, same gross pay each week/month/whatever, the payroll people can figure out what your taxes will be at the end of the year, assuming short form/standard deduction, and withhold enough from each paycheck so that you'll owe little or get very little as a refund.

If you work a second job, they'll probably do the same thing, but the problem is that there are tax "brackets". I don't know where the brackets are, but for illustration, say it's 10% on the first 20,000 and 15% on the next 20,000, and 20% on the next 20,000, and 25% on everything over 60,000. If you have two part time jobs, each with a gross of 15,000, they'll each withhold based on the 10%, but you'll be in the 15% bracket for 10,000 of it, so you'll be $500 short at the end of the year. Again, don't use those numbers to plan, just use them to understand how it works.

Here's what you really need to figure out how to do:

Live within your means on the single income, and use the time you're planning to work a second job to get the education or skills to earn more, or start your own business. I'm not judging you or trying to say it's easy, because it's not easy, and a lot of really nice and successful people have been where you are. All I'm saying is that another job is not a great solution.

Answer 3

Hello:

One way to look at your challenge is to note that you are taxed, through withholdings, at a standard rate of income tax. At year end (2008 tax filing) you would have withholding taxes which should offset your tax liability.

Unless you choose to not have withholding (probably not a good idea) most, all or amounts in excess of your tax liability will have been applied already. Also, as you look for work, keep track of your expenses as you may be able to claim them on this years (2007) tax return filed in 2008.

It will not make a difference if you have one or ten jobs over the year or more then one at a time. Your employer has the responsibility to capture your wages, withholdings and net payment to you. Be careful if you are working for cash or if your employer/friend/acquaintance is not withholding taxes. Not good for you or them.

Most importantly, don't stress on this. It will work out over the course of the year. Any taxes on wages are at a minimum twelve months off.

Good Luck

Answer 4

As long as your second job doesn't throw you into a higher tax brackett, you should be fine. They don't penalize you for having more than one job.

Answer 5

Sure you would be taxed more---simply because you are making more money.