Why do they take out such small federal tax on my monthly check because I'm married?

Question

My last check was around 1300. I get paid monthly and am married.
I thought something was wrong when they only took out 7 dollars for my federal income tax but when looking at the IRS chart here http://www.irs.gov/pub/irs-pdf/p15.pdf it actually looks like they are taking out the right amount considering I put a 2 for my W-4.

WHy do they take out such a small amount though? I know you get a tax break for putting a 2 on the W-4 as well as for being married but I'm destined to be owing taxes at the end of the year if I'm only paying 7 dollars a month for taxes aren't I?

yes my spouse is working as well.

Answer 1

Because they are using the standard decuctions. Change your decuctions to one and they will take out more taxes. though unless you are paying a penalty, I would just put the difference into bank account and have you earn the interest instead of Uncle Sam

Answer 2

They take out tax as though that's the only income you'll be filing on. If your spouse doesn't work, then you won't owe much tax on that income - the two exemptions, plus the standard deduction of $10,700 for a married couple, will take your taxable income to where you'll hardly have any tax liability.

But if you and your spouse together have additional income, like maybe your spouse works also, then depending on your total income, you could very possibly end up owing taes when you file. Since you don't give that info, it's not possible to say if you have a problem or not.

Answer 3

It doesn't mean you will be owing taxes at the end of the year. It depends on your situation. If you have children, the earned income credit could offset any monies owed. The amount you are owed or must pay isn't just based on your employment income. There are other factors to consider based on your specific situation.

Regardless, I'd put the difference into a savings account and earn a small amount of interest rather than let the government have it before they need it.