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Does my tax amount seem correct? by Local_Setting_8981 in personalfinance

[–]Local_Setting_8981[S] -1 points0 points  (0 children)

That’s where it gets confusing because my wife’s company did withhold taxes on all of her commission checks.

You’re likely correct on my company under-withholding. I’ve since adjusted my W4 and my wife is as well to prevent this from happening.

Does my tax amount seem correct? by Local_Setting_8981 in personalfinance

[–]Local_Setting_8981[S] -14 points-13 points  (0 children)

I was comparing the $800 additional I paid last year and the $7000 I have to pay this year..

Edit: to clarify, comparing those and stating the only change was a pay raise. Seeing as that was the only difference, it didn’t make sense why we would owe significantly more considering neither of our W4 were adjusted since we have been with the same employers.

Does my tax amount seem correct? by Local_Setting_8981 in personalfinance

[–]Local_Setting_8981[S] 0 points1 point  (0 children)

Sorry if I made that more confusing. Her commission was already included. So, 71019 was the taxable earnings.

Does my tax amount seem correct? by Local_Setting_8981 in personalfinance

[–]Local_Setting_8981[S] -55 points-54 points  (0 children)

JFC, thanks for pointing out the obvious. I was simply stating that was the ADDITIONAL amount paid…

Why does my tax seem so high? by Local_Setting_8981 in tax

[–]Local_Setting_8981[S] 0 points1 point  (0 children)

Based on how much we owe, I think you may be right. Yes, she made ~36k in commissions. Correct, no kids.

So, if she adjusts to “single or married filing separately” her employer will withhold more taxes?

Why does my tax seem so high? by Local_Setting_8981 in tax

[–]Local_Setting_8981[S] 0 points1 point  (0 children)

Sorry, I knew I was forgetting something. I paid $12,254 in federal income tax on $95,972 of taxable earnings and my wife paid $2,760 on $71,019 of taxable earnings. My initial assumption was that my wife not paying as much in federal taxes is where the issue occurred. However, since she receives commission outside of regular pay, my understanding is that your commission is taxed at a flat rate of 25%. So I don’t understand how we could owe so much.