What is a rough formula for figuring out taxes?

[City Bound]

I know taxes are not the same for everyone, and some people pay more, but is there a basic formula to figure it out?

I was looking at some pay stubs and it seemed like they were taking 25%...roughly one week a month and three months a year. So, would subtracting 25% be a good start in figuring out what the gov will take?

[Tom in TN]

City Bound,

Roughly, how long is a piece of string? It all depends.

Same way with taxes. It is entirely dependent on how much you make, what kind of income you have, how many deductions you can claim, how many exemptions you can claim, how much you pay for child support, etc. etc.

You might talk to some other people who are similarly situated as you are to get an idea of how much they pay in taxes, otherwise, it's entirely moot to guess at what your tax liability will be.

Tom in TN

[where I want to]

For federal, the IRS website will give you income tax tables, your State tax collector (whatever it's called there) will give you state income tax rates and any other state withholdings, FICA is a set rate (somewhere around 7.25% -I can't remember exactly).
It varies with your income each pay period if your pay varies enough. If your income is higher enough, it can switch you to another tax bracket, so I don't think anyone can give you the percentage without your disclosing your earnings.
Wouldn't it be nice if it was just a set percentage??

[Usingmyrights]

Yes, there's online tax tables. I know that when I looked last year that at $35k it went from 15 to 25%. Remember though that, thats taxable income after deductions. There should be online calculators that'll let you put your info in just like you're doing taxes and give you an estimate.

[Macybaby]

what they take out of your paycheck has nothing to do with what taxes you end up actually paying. There are basic formulas for the withholding part, the key is for you to know your situation, and adjust your withholding so that the correct amount is taken out based on what you need.

Right now, I need to have about 14% taken out of GROSS wages in order to have the correct amount withheld for when I file my taxes at year end. My husband works seasonal, so when he works he makes a lot of money. Withholding is based on the assumption that you are making that amount year round, so he always has a lot taken out of his paychecks in relationship to what his annual income is. So I adjust my withholding (easier for me to do) so that I'm having less withheld, so it all works out at tax time.

Also remember, the amount withheld for SS and Medicare have nothing to do with federal income taxes. Many people consider that when they say what percent is withheld, but you need to subtract that out to figure what the real percent withheld for federal income taxes is.

At least I live in a State with no State income taxes.

[rambler]

Based on your last year's taxes, the govt tries to withold about what you will owe this year.... But of course things change from year to year, depends on if your deductions change, if your income changes, etc. Are you looking at all the witholdings - SS, Medicade, State income taxes, or only Fedrail income?

If you make too much you will change up to another higher tax bracket.

If you have some bonds or other income that you cash in during the year you might need to pay a bunch of tax on that.

Deductions range from how many kids you have, dependants, might be medical, or energy efficiency bonuss, house payments, and a few others.

Did you have a refund or did you have to pay in lasyt year after figuring your taxes, as the witholdings really are _not_ your taxes, they are just a very loose guess as to what about you might owe if not much changes.

So it is very very hard to come up with any 'average' number that means anything to any one person.

If you get a fairly big refund most every year, you might do well to change how your witholdings are done, claim more dependants or other proper ways, so that you are not paying too much during the year. Of course, a friend of mine liked to get a big refund, he considered that his savings plan, didn't mind letting the govt have his money all year interest free, because he couldn't save on his own..... Go figure.

--->Paul

[edcopp]

How much money do you have? Send it in.

[HDRider]

From Fortunate Son by CCR

And when you ask them, "How much should we give?" They only answer "More! More! More!"

For more about The Great CCR
http://en.wikipedia.org/wiki/Creeden...rwater_Revival

[ldc]

City Bound, add the 10% the East Coast cities get for letting you work there! NYC, Wash. and Boston, as I recall. I figure on a 1/4 to 1/3 of my gross roughly, but part of my income is self-employment which means I pay double federal taxes; both the employer's and the individual's part. But I'm also in the lowest tax bracket.

If you are planning on being self-employed when/after you make your move, you might want to acquaint yourself w/ some of its vagueries ahead of time. Best regards, ldc

[highlands]

Short answer:
If you are making less than $35,000 ___NET___ as a couple with 2.3 kids then your taxes are minimal and you may well get back something from the government. If you don't file a tax return you won't get that back.


Long answer:
I would suggest going to the IRS.gov web site and downloading the i1040 which is the instruction booklet for the 1040 income tax forms. Read it. Work through it with your hypothetical income. Download the related forms you'll need such as Sch.C, Sch.F, Sch.SE and such along with their instructions. If you start on line 1 of 1040 and work your way to the end using your situation then you know how it works out. It isn't rocket science, just complex and slow. Take it step-by-step.

Then do the same thing for your state.


Full answer:
It varies.

Cheers

-Walter
Sugar Mountain Farm
Pastured Pigs, Sheep & Kids
in the mountains of Vermont
Read about our on-farm butcher shop project:
http://SugarMtnFarm.com/butchershop
http://SugarMtnFarm.com/csa

[Silvercreek Farmer]

See what you paid last year all said and done, assuming not much changed, it shouldn't be terribly different this year.

[jwal10]

http://www.taxfoundation.org/taxfreedomday/ ....James

[PezzoNovante]

Roughly 17% to 22% for married, 3 total dependents, gross income $75K to $200K.

[Energy Rebel]

I use 20% as a rough estimate and hit it pretty close.

[Alice In TX/MO]

I set aside 25% in an account each month to pay our quarterly taxes.