Not enough federal tax taken out... ugh.

[SOnotLayuh]

I worked for CVS for about a month (they treated me like crap - I was a part time manager and they told me I needed to choose between going to class and working one night so I dropped them pretty quickly).

I earned 1,058$ total. They only took out... 10.58$ in federal taxes?

I can't find my pay stubs, but that seems really wrong.

Anyone had something like this happen?

Also, they got my name wrong on the W2. Is that going to cause a problem? My name is Leia, they put Lisa.

 

[Jeff_G]

10.58 is 1% of $1058, the lowest tax bracket is 10% so they should have witheld 105.80. I would call the main corporate office and tell them you believe the W2 is wrong and ask them to recheck the numbers and correct the name. I would also ask on a seperate call for back copies of you pay stubs, you might try this first to see if you can catch the error.

However I guess it is possible you claimed enough exemptions to have them only pull 1%...

 

[Claire&TheBoys]

That's totally possible. Taxes are withheld based on the wages you earn in a particular period. For example, I work very part-time for a CPA. He pays me monthly and I typically work less than 20 hours per month. My total wages for 2010 were something like $2700 and he only withheld $15 in federal income tax the entire year. It is because my wages are earned so little at a time that I don't meet the threshold for tax withholding per check. I don't claim any exemptions.

 

[SOnotLayuh]

I didn't have any exemptions - we don't have any kids, I normally claim 0.

The amount I earned was spaced over 3 paychecks, so they all should have been high enough to have more money taken out.

This W2 took away around 250$ off of my tax refund

 

[msmayor]

The name issue probably won't matter at all...its the social security number that is more important, since that's what the IRS will use to match to your return.

If you are really concerned that the amount withheld is incorrect, question it...and start looking for your last paystub. That will have all the cumulative amounts withheld shown on it.

It IS possible that the $10 figure is correct. As another poster mentioned, its all about what the tables require based on your gross earnings. I have a job where I earned about $3,700 for the year and only $4 in federal taxes was withheld.

Your situation is a reminder to all to CHECK THOSE PAYSTUBS during the year; don't wait until tax time to review and decide that not enough was withheld.

 

[scrapquitler]

I worked for CVS for about a month (they treated me like crap - I was a part time manager and they told me I needed to choose between going to class and working one night so I dropped them pretty quickly).

I earned 1,058$ total. They only took out... 10.58$ in federal taxes?

I can't find my pay stubs, but that seems really wrong.

Anyone had something like this happen?

Also, they got my name wrong on the W2. Is that going to cause a problem? My name is Leia, they put Lisa.

I made $5200 last year and only had something like $80 in taxes taken out. I think it happened because I never had a check that was over $300.

 

[sam_gordon]

I got a W2 in for $2700 with $1.30 held out in Federal.

 

[traces7]

My employer didn't take much out for federal taxes either. My DH made double what I made, but had 4 times as much federal taxes taken out. So I think they didn't take enough out of mine. And now we're ending up paying in.

I claim 0 exemptions also, so I'm going to go and have more withheld from my paycheck.

Of course last year we had the Making Work Pay extra in our checks, so the amount withheld for federal taxes was less than it will be this year, but I think I'll still need more taken out this year.

It's a bummer, we were hoping for a little refund!

 

[bicker]

It is important to remember that regardless of the employer's responsibilities, the taxpayer's is still ultimately responsible for ensuring that the amount of money actually being withheld is correct.

I hate that, because I have no idea how to figure out what is correct, but I figure that if the number looks like it'll eventually add up to my tax bracket, I'm good.

 

[sam_gordon]

I hate that, because I have no idea how to figure out what is correct, but I figure that if the number looks like it'll eventually add up to my tax bracket, I'm good.

Actuallly, it's pretty easy... especially if you're single. On your tax return will be a line showing how much tax you are supposed to pay (after all deductions, credits, etc). Assuming you didn't go through some unusual procedure (buying/selling a house, major medical expenses, etc) that won't continue, take that amount and divide by how many paychecks you get a year (every other week is 26, twice a month is 24). That's how much should be taken out each paycheck.

If you're a dual income household, you can break down the percentage of each earner, and figure out how much each should owe.

 

[Claire&TheBoys]

You can visit the IRS.gov website and look at this publication, called the "Circular E" which gives the withholding tables for employers writing paychecks.

http://www.irs.gov/pub/irs-pdf/p15.pdf

There are tables for each different pay period duration (daily, weekly, bi-weekly, semi-monthly, monthly) and you find the table for Single or Married, your wages are on the left and the number of exemptions across the top. You can see what the federal requirement is. If it's not enough for your situation, you can fill out a new W-4 and specify that you want $X extra withheld every pay period. I remember when my husband and I first got married, before we had kids, we had to have extra withheld so that we did not owe at tax time.

There are online calculators - one is at the IRS.gov website, given below - that you can use to figure out how much you should have withheld per pay. There are also worksheets on the W-4 that can help you decide how many exemptions to claim and whether to have extra withheld.

http://www.irs.gov/individuals/article/0,,id=96196,00.html?portlet=4

 

[pklein09]

Pub 15 (Circular E) from the IRS will show you how much money should be taken out in taxes by your employer based on your W4. When you make very little in a paycheck, very little in taxes comes out. The problems is when all those very little paychecks add up to "something" and that "something" requires more taxes than what was withheld.

http://www.irs.gov/pub/irs-pdf/p15.pdf

I'm sorry you've gotten caught by this.

 

[bicker]

Thanks for the pointers. Now we all can responsibly verify that our withholding is accurate.

 

[mjkacmom]

This happened to DH last year. He has a PT college teaching assignment, and apparently they didn't hold any federal taxes, so we got a letter over the summer, claiming we owed about $500. Oops!

 

[dkr7166]

Last year, I did payroll preparation for one company until I was laid off. I had one girl contact us to verify that her withholding was correct because it was 0. I looked at the tax tables for withholding and sure enough, the amount she was making WAS subject to no federal withholding.

If you're part time, it's very possible it's correct and that you are in a similar situation.

 

[seashoreCM]

If the paychecks all year long were each about the same size and that is all of your income for the year, then the withholding of ten dollars or so should come out nearly right or maybe give you a refund.

 

[angierae]

Also, it didn't screw up your refund - you just already got that money by not having it taken out of your checks.

 

[mrsbornkuntry]

Actuallly, it's pretty easy... especially if you're single. On your tax return will be a line showing how much tax you are supposed to pay (after all deductions, credits, etc). Assuming you didn't go through some unusual procedure (buying/selling a house, major medical expenses, etc) that won't continue, take that amount and divide by how many paychecks you get a year (every other week is 26, twice a month is 24). That's how much should be taken out each paycheck.

If you're a dual income household, you can break down the percentage of each earner, and figure out how much each should owe.

Thank-you for explaining this! I find this much simpler to understand than the calculators I've found, I will be doing this.

 

[disykat]

I work part time and this is always an issue. I have extra taken out of my paycheck for this reason. If I don't, we pay it at tax time.