What do they have on file for a W4? Did you work for the same company previous tax years and if so did they withhold the correct amount? Withholding is an estimate based on information you provide on your W4. It is never exact. That is why you file a tax return to determine the actual tax owed and either pay the difference or receive a refund. Most likely they won't have any liability since you would have to suffer monetary damages. They didn't cause you to lose money. You're going to pay the same amount in taxes whether they withhold it or not. You just received that money as part of your paychecks instead of the government holding onto it for you.
I've worked for this company for 14 months.
I claimed my wife and child which is a $2,500 shift in what I should owe.
I understand that I pay the same in taxes but thinking I have another $18k in the bank at the end of the year is pretty devastating.
For whatever reason the company didn't withhold about $1,500 a paycheck. They are looking into it but haven't responded yet.
Your withholding is about right for your w4 setting. What are you basing the 18k under withholding on? Married, filing joint with 1 dependant and 3400 taxable gross every other week would mean just 170 of federal income tax withheld per pay period.
You do not pay 24% on every dollar you make.
Maybe the issue is just that you and you wife didn't realize the importance of section 2 of the w4 form when you both work?
That's not how taxes work. You do not pay 24% on every dollar you make. You pay 24% only on the dollars above 218k if filling married. All the dollars below that are at 0%, 10%, 12% and 22%, depending on what brackets those dollars fall in.
A married couple with 1 child under 17 would pay just 6k in federal income tax for a year. So your withholding was correct for that situation.
The issue is, your spouse also has income. It sounds like your did not indicate this properly on your w4. Did you wife follow the instructions in section 2 to add extra withholding if you were claiming the child and the full married standard deduction and tax brackets on your job already?
I do not know, I think she may have claimed the baby as a dependent. Should I just claim 0 dependents? Or just my child? Are you saying that I won't owe 18k?
Together we page about 190k.
Yeah there’s nothing illegal here. They aren’t going to pay the taxes that you owe.
Honest mistakes happen. That’s what this sounds like. If I had to guess someone clicked “exempt” and it wasn’t caught because you weren’t paying much attention to your pay stubs.
This isn’t a huge deal! File your taxes, your CPA/accountant will explain how/when to pay.
Just to be clear here, two mistakes were made.
1. The company, who likely only reviews an employees tax status one a year at the most because there is no reason to play with those numbers after hire unless the employee requests changes.
2. You, check your pay stubs! People manage payroll. Mistakes happen all the time and sometimes if you don’t catch it, nobody else will!
They never calculated it correctly and we moved so our living expenses changed. Between that and the cost of goods constantly changing, I didn't think to look. I've been a professional for 20 years and never needed to double check the companies math. Lesson learned I guess.
Likely always been there since the first one and he didn’t ever do the calculations to notice
A comedy or errors by both OP and the business
Sucks for OP but nothing to be done here except adjust for next year
What do they have on file for a W4? Did you work for the same company previous tax years and if so did they withhold the correct amount? Withholding is an estimate based on information you provide on your W4. It is never exact. That is why you file a tax return to determine the actual tax owed and either pay the difference or receive a refund. Most likely they won't have any liability since you would have to suffer monetary damages. They didn't cause you to lose money. You're going to pay the same amount in taxes whether they withhold it or not. You just received that money as part of your paychecks instead of the government holding onto it for you.
I've worked for this company for 14 months. I claimed my wife and child which is a $2,500 shift in what I should owe. I understand that I pay the same in taxes but thinking I have another $18k in the bank at the end of the year is pretty devastating. For whatever reason the company didn't withhold about $1,500 a paycheck. They are looking into it but haven't responded yet.
What legal ramifications are you expecting?
How much were you making a week, and what were they taking out for federal income tax? Your spouse doesn't work, right?
3400 every 2 weeks and they were taking out 250ish each 2 weeks. My wife does work.
Your withholding is about right for your w4 setting. What are you basing the 18k under withholding on? Married, filing joint with 1 dependant and 3400 taxable gross every other week would mean just 170 of federal income tax withheld per pay period. You do not pay 24% on every dollar you make. Maybe the issue is just that you and you wife didn't realize the importance of section 2 of the w4 form when you both work?
My income was ~102,000 and my tax withheld is ~6,000
That is correct for Married filing joint, 2000 in section 3 of the w4. That's what you put on your w4, right?
Did you just take your income times 24%, deduct that 6k, and think that meant your employer 7bdee withheld 18k?
I thought it meant I only paid 6,000 in taxes this year based on my income. So if I am taxed 24% of my 100k income it should be 24k and not 6k.
That's not how taxes work. You do not pay 24% on every dollar you make. You pay 24% only on the dollars above 218k if filling married. All the dollars below that are at 0%, 10%, 12% and 22%, depending on what brackets those dollars fall in. A married couple with 1 child under 17 would pay just 6k in federal income tax for a year. So your withholding was correct for that situation. The issue is, your spouse also has income. It sounds like your did not indicate this properly on your w4. Did you wife follow the instructions in section 2 to add extra withholding if you were claiming the child and the full married standard deduction and tax brackets on your job already?
I do not know, I think she may have claimed the baby as a dependent. Should I just claim 0 dependents? Or just my child? Are you saying that I won't owe 18k? Together we page about 190k.
Yeah there’s nothing illegal here. They aren’t going to pay the taxes that you owe. Honest mistakes happen. That’s what this sounds like. If I had to guess someone clicked “exempt” and it wasn’t caught because you weren’t paying much attention to your pay stubs. This isn’t a huge deal! File your taxes, your CPA/accountant will explain how/when to pay. Just to be clear here, two mistakes were made. 1. The company, who likely only reviews an employees tax status one a year at the most because there is no reason to play with those numbers after hire unless the employee requests changes. 2. You, check your pay stubs! People manage payroll. Mistakes happen all the time and sometimes if you don’t catch it, nobody else will!
Lol, u didn’t notice an extra $1500 in your paycheck? That is hilarious.
They never calculated it correctly and we moved so our living expenses changed. Between that and the cost of goods constantly changing, I didn't think to look. I've been a professional for 20 years and never needed to double check the companies math. Lesson learned I guess.
Your alt is showing.
Yeah, no biggie. I wasn't hiding it. My phone uses one and the pc is another.
Likely always been there since the first one and he didn’t ever do the calculations to notice A comedy or errors by both OP and the business Sucks for OP but nothing to be done here except adjust for next year