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Q. My husband works for a large company, and I receive disability and do not work. We just had our taxes done this week and got quite a shock! We had a federal income tax refund of over $4000, but owed state tax of $1000 and local taxes of $600. We are in PA. How [...]
As the end of 2009 quickly approaches, it’s important for all tax payers to begin preparing for the filing of their 2009 tax returns.
- Have you maxed out your HSA or IRA contributions? People with these kinds of accounts can actually make contributions for 2009 through April 15. Maximizing your contribution helps reduce your taxable [...]
Q. How do I know what tax bracket I’m in? Where does that number come from?
A. This question probably ranks right up at the top of the list of most frequent questions. First of all, you probably meant to ask what is your marginal tax rate. Let me explain. Federal income tax is calculated on [...]
Q. My paycheck is wildly different each time because I am paid commission in the 2nd check and a draw on the first check of the month. I submit a new W-4 each period to keep my withholding down. Now my payroll department doesn’t want to accept more than 1 change each month. Is this [...]
Q. Is there a statement somewhere in the tax laws that states, I can pay someone up to $600.00, tax free to both parties? Or something to that effect?
A. Yikes! Every time I get a question like this it scares me to death. “There is no such thing as a free [...]
Q. I live in Michigan and just started a new job working in Illinois. I’ve never been in a situation with two states before. My payroll department wants me to fill out all these different forms. What should I do?
A. I love multi-state tax situations! It’s like job security for accountants. The answer to your [...]
Q. I received a bonus check and the amount that was on the paystub was $500 less than what the bonus came out to. When asking the owner he stated that money was used to pay for the employer’s share of the taxes. On top of that, they took out taxes for my [...]
Special Note: Dear readers, Thanks for your patience last week. There were two problems with the blog. Due to a configuration issue, it was down for a few days. Also, I was unable to post due to a very remote cabin for a week-long vacation. Things will return to normal [...]
Q. I am drawing Social Security and have a part-time job with my old company. They are withholding taxes from my check. Is this legal? I thought once you were on Social Security that all wages were tax free.
A. This is one of the biggest misunderstandings amongst the
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Q. My employer did not withhold any federal or state tax last year, just Social Security and Medicare. What do I do?
A. This is really a serious problem. However, the number of ways you could get into this problem are many. First lets tackle the federal issue. Check with your employer to see what [...]
