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You are right. It doesn't help to withhold less only to end up with a debt to Uncle Sam. Besides, Uncle is hurting right now, too and needs all the help we can give
Edited by: COACHPENNY at: 1/3/2013 (18:51)
“A word to the wise ain't necessary, it's the stupid ones who need the advice.”
The taxes taken out of your check are based on the date the check was issued, not the payroll period it covers. So that's why your check had the '13 tax rates reflected.
The larger FICA deduction reflects the end of the 2% FICA employee portion tax cut (I think officially they called it a tax "holiday"). It was only in effect for one year, and it was never on the table to be extended. It's not really a part of the "fiscal cliff", but people certainly got used to it and forgot when it expired. The rest of the changes you could probably just attribute to your raise or tax rates adjusting a little for inflation.
I work for an accounting firm, and I've got so many phone calls today from mad employees who don't understand why their check is smaller. It pays to be informed.
Also, when you change your withholding just make sure that it won't cause you to owe a large amount at the end of the year. I get a lot of angry phone calls about that too.
“There isn't a way things should be. There's just what happens, and what we do.” Sir Terry
So today I got my first paycheck of 2013. And although it's for the two weeks ending Dec 29th, they took out more in Fed (about $10 more), FICA (about $41 more), and Medicare (about $1 more). Over all my pay was up a bit (thanks to a $1500 raise in 2012). For some reason my work started the new pay year the last two weeks of Dec. So I'm seeing the "over the cliff" results now I think (at least I hope that's what I'm seeing!). I'm going to do some creative stuff with my pay (like drop the amount I have taken out each payday to buy company stock) so that I don't end up with less on each check then before my raise. With a new car payment I need all the extra I can get!
The 97% is feeling the pain again!
An AAngel appears to be just like everybody else, only more so.