(Closed) Can someone who understands this stuff please explain it to me?

posted 6 years ago in Career
Post # 3
Member
13 posts
Newbee
  • Wedding: July 2012

The amount of taxes you pay has changed. Your employer will be making larger deductions for social security and Medicare on your paychecks. Income tax has also increased so the tables show how much should be withheld from each paycheck so that you do not owe money to the IRS when you file. You do not have to do anything. Your employer is making the changes. They just sent that out to explain why your paycheck will be smaller. 

Post # 4
Member
1562 posts
Bumble bee
  • Wedding: November 2011

Part of the “fiscal cliff” was that some Bush-era tax breaks, in the form of SSI and FICA withheld out of each paycheck, were ending, and the employees would see the change in their paychecks.  It’s not just you – every worker in the US is getting this.  Like MissMeeps said, you don’t need to do anything – its just a notification as to why your amounts changed.  

Post # 6
Member
5475 posts
Bee Keeper
  • Wedding: August 2012

My checks went down about $100 because our healthcare premiums also went up.  I’ll have to be more aware of frivolous spending, like eating out and stuff, but our budget is set up so that a $200/mo cut will not send us into despair.  I pay most of our bills because I make more & I already owned my home when we got married.

Post # 8
Member
5475 posts
Bee Keeper
  • Wedding: August 2012

@hiroshymatetrastar:  I suppose he’ll have to look closely at his paystub.  Luckily for me, my health insurance comes out before tax so my taxable income is lower than if it came out after taxes.  There are so many little intricacies that make it confusing.

Post # 10
Member
523 posts
Busy bee
  • Wedding: March 2013 - Callanwolde Fine Arts Center

@hiroshymatetrastar:  First, find his income bracket in the biweekly single column. Look to the right of that column and it says ($xxx plus xx% over $xx,xxx). Subtract his biweekly income by the $xx,xxx and multiply that by xx%. Then add that to the first number ($xxx).

Example:
So, say someone makes $2000 biweekly as a single person. They would fall into the third row, over $1,479 but not over $3,463. They pay $191.95 plus 25% in excess of $1,479.

$2000-$1479=$521
25% of $521=$130.25
$191.95+$130.25=$322.20

Total income tax withheld is $322.20 per biweekly pay period.

 

Post # 11
Member
1562 posts
Bumble bee
  • Wedding: November 2011

Don’t forget – this is also taken after health insurance, 401(k) and any other pretax items are taken.  So if your FH makes $2000 per week, but then has $100 for insurance, and $200 for 401(k) taken out, you would use $1700 as the income for the chart.  Does that make sense?

Post # 13
Member
1279 posts
Bumble bee
  • Wedding: January 2012

cheebs  thanks for breaking it down for us….man mine is going to be abou $238.83 lower and that’s not icluding the addtl 52 dollars that our medical benefits will be going up with every pay check….wow that’s 300 dollars less I will be getting this really sucks!
Update…not as bad as I initially posted as soon as I posted this we got our checks via FEDEX and mine was only $64.00 less….thankfully….

 

Post # 14
Member
1562 posts
Bumble bee
  • Wedding: November 2011

@mija22:  Not to be rude, but I really hope you did that math wrong!  To have a change of $283 weekly just on FICA and SSDI raising is enormous!  Are you sure that’s not your new withholdings with all the taxes, and not the change?

Post # 15
Member
10366 posts
Sugar Beekeeper
  • Wedding: September 2010

Ok, before people start panicing – remember when our payroll taxes went from 6.2% to 4.2% and everyone was super happy that their paychecks mysteriously got bigger?

Well that was temporary. And as part of the fiscal cliff deal, it went back up to where it used to be. Hopefully most people aren’t cutting things so close that a 2% difference they used to pay anyway is what breaks them.

The other tax increases don’t effect you unless you make mad bank. And if you make mad bank, again, there’s probably some places you could cut back if you’re living paycheck to paycheck…

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