Tax Question

[daughtersrus]

I posted this on the Community Board but thought I'd ask here as well.

I was looking over DH's W-2 form for 2012 and compared it to 2011.

He made $700 more in 2012 but contributed $80 less to 401k so a net of $620 more in 2012.

He hasn't changed his withholding in many years but although he made more money in 2012, he had $827 less in Federal taxes withheld. His state taxes are correct(haven't done the taxes yet but percent wise).

He spoke to the lady in the office (no HR dept) and she has no answer but confirmed his with-holdings were the same.

Any ideas why the difference?

 

[undertheradar]

How many Pre-Tax deductions are involved?

 

[ssawka]

I posted this on the Community Board but thought I'd ask here as well.

I was looking over DH's W-2 form for 2012 and compared it to 2011.

He made $700 more in 2012 but contributed $80 less to 401k so a net of $620 more in 2012.

He hasn't changed his withholding in many years but although he made more money in 2012, he had $827 less in Federal taxes withheld. His state taxes are correct(haven't done the taxes yet but percent wise).

He spoke to the lady in the office (no HR dept) and she has no answer but confirmed his with-holdings were the same.

Any ideas why the difference?

Do you mean he contributed $80 more to 401k? You said he had a net of $620 more after 401K. That would indicate that he contributed more to 401K. Granted, that would not account for the $827 discrepancy, but just trying to get an accurate picture.

Also, did his insurance premiums go up as far as what he contributes? His contributions would come out of his check pre-tax, so that could account for the difference. You need to look at the difference in taxable income, not total income.

 

[daughtersrus]

Do you mean he contributed $80 more to 401k? You said he had a net of $620 more after 401K. That would indicate that he contributed more to 401K. Granted, that would not account for the $827 discrepancy, but just trying to get an accurate picture.

Also, did his insurance premiums go up as far as what he contributes? His contributions would come out of his check pre-tax, so that could account for the difference. You need to look at the difference in taxable income, not total income.

Sorry, I was wrong. In 2012, he made $620 more before 401k but his income after the 401k deductions in 2012 was $700 more.(he contributed $80 more in 2011 than he did in 2012. He must have had 53 paychecks in 2011)

The only other things deducted from his check are uniforms (they were $200 less in 2012) and union dues (they were $30 more in 2012). He does not have insurance withheld from his pay.

 

[Claire&TheBoys]

One thing that comes to my mind is if he got a bonus in 2011, typically more taxes are withheld from a bonus check than a regular paycheck - that might account for the difference. Then I would assume he'd gotten a pay raise in 2012 that was the amount of the bonus plus a little.

If he changed his withholding allowances for 2012 (had more than 2011), that would account for having less in federal withholding.

You have to look at all the figures from his last paychecks of 2011 and 2012 not just the figures on his W-2 to really understand what is being reported.

 

[Shelly F - Ohio]

I had a simular problem. I worked at two different companies making the same $ per hour, worked the same amount of hours and both were located in the same city just a few blocks away from one another. Same withholdings. but my paychecks differed.

My new company withheld less federal tax and I questioned it. They used Quickbook Payroll software and the other company used APD payroll services. I think the Quickbooks software is the issue.

My first paycheck from the new company was only for 2 days of work because they had me start on a Thursday. I noticed that no federal tax was withheld I questioned this and payroll said it was correct. Next paycheck which was for an 80 hour pay so I compared it to my old company and sure enough there is a difference in the fed.

 

[daughtersrus]

One thing that comes to my mind is if he got a bonus in 2011, typically more taxes are withheld from a bonus check than a regular paycheck - that might account for the difference. Then I would assume he'd gotten a pay raise in 2012 that was the amount of the bonus plus a little.

If he changed his withholding allowances for 2012 (had more than 2011), that would account for having less in federal withholding.

You have to look at all the figures from his last paychecks of 2011 and 2012 not just the figures on his W-2 to really understand what is being reported.

He's never got a bonus. He's an autotech and is paid "book hours" but is paid a minimum of 34 hours as long as he works 40. He hasn't had a "big" check in a number of years. To be honest, his pay has gone down anywhere from $3,000 as much as $10,000 each year for the last 5 years or so. Sadly, most of his checks are the minimum or right around 40hrs. Long gone are the days of 50-60 hour checks.

I have all of the pay stubs so I will see if anything sticks out.

He hasn't changed his withholdings in over 20 years.

I was just wondering if we need to change something. The lady in the office was really no help.

 

[daughtersrus]

I had a simular problem. I worked at two different companies making the same $ per hour, worked the same amount of hours and both were located in the same city just a few blocks away from one another. Same withholdings. but my paychecks differed.

My new company withheld less federal tax and I questioned it. They used Quickbook Payroll software and the other company used APD payroll services. I think the Quickbooks software is the issue.

My first paycheck from the new company was only for 2 days of work because they had me start on a Thursday. I noticed that no federal tax was withheld I questioned this and payroll said it was correct. Next paycheck which was for an 80 hour pay so I compared it to my old company and sure enough there is a difference in the fed.

That is probably the answer. They used ADP for years and switched to a different company for payroll sometime last year.

 

[GOOFY D]

That is probably the answer. They used ADP for years and switched to a different company for payroll sometime last year.

Maybe, but the tax tables are the same for every company.

 

[undertheradar]

You could check the tax against the IRS tables and request more be collected from each pay. This is different for each taxpayer.