So I’m still investigating this, but figured I’d ask here to see if this sounds right.
Last year, I got a promotion and along with that, a pay raise and also started a 401K for retirement.
Other than that, NOTHING at all changed from the norm since I started here back in 01. I went to the website where I usually do my taxes (www.taxslayer.com) and filled everything out like I usually have for the past 3 years.
I assumed since I had the 401K, I’d actually get a little more back than usual since it’s non taxable income. I normally get back $200-$600 for a federal return… and usually owe $100-$200 to the state.
Well to my surprise, when I finished entering all my information into the system it showed that I owed the federal government $1900.00 and owed the state $21.00. WTF? Is there something I’m missing here? Do you have to fill out a separate form for the 401K info or something?
I called HR to see what the deal is and hope they didn’t screw something up, but still waiting to hear back from them. I’m going to be pissed if I have to come up with $2K bones to pay out, I had that money set aside for other things.
the link listed above. I just entered all my W2 info exactly as it asks for it (it literally looks exactly like a W2, but with a bunch of blank boxes that you have to fill in from your W2)
hmm i know when you either start a 401k or withdraw money from one, things can get fucked up.My mom withdrew 10 grand from her 401k to finish our kitchen and they told her she would not be taxed on it.Then when she filed her taxes they claimed she owed the govt 3-4k and that it was from her 401k.So she was screwed and had to pay and couldn’t do anything about it.They lie alot so you have to be very careful.The also did something to her similar when she started her 401k.They seem to lie and say its not taxable either way and then soemhow you end up owing the govt.
I suppose your promotion may have moved you into a new tax bracket. Unless you’re putting the full amount of your raise into the 401k you could still end up in that higher bracket. Here’s the bracket for 07 (scroll down a little): http://www.fairmark.com/refrence/2007reference.htm
Or HR may have fucked up and failed to take enough out of your check. Go back and look at your pay stubs prior to your raise and see how much was coming out for federal taxes. Now look at your current pay stub and see if that amount when up a proportional amount compared to your new gross pay.
Do you claim 1 or 0?
Did you have any untaxed income like a bonus, or 1099 work?
Sounds like you’re doing short form if all it’s asking you is for the info from your W2. Without a house, kids, or a personal business I doubt you could meet the standard deduction so it makes sense to do short form.
as far as i know the taxes taken out of your check are figured based on the previous years gross income. so if you got a promotion that was significant that could definatly account for you owing them money.
well, maybe not more… but I figured it would help. For example, 35K opposed to 40K as taxable income. Wouldn’t I only be paying tax on 35K instead of 40K? So I’d owe less? This stuff is all new to me, so maybe thats not the way it works
401K contributions are not taxable if you make over XX,XXX amount.
Pre Tax contributions DO lower your taxable income amount though (but not for NYS).
The more you make, the more you’re supposed to pay in income tax, it is very possible that payroll hasn’t been deducting enough — this happened to my wife for the 2007 year. They were taking ~9% instead of ~12% for Fed.
Are you claiming Single / 0? If so, you “should” be right, assuming that you don’t have any commision (which is taxed higher %).
Try TurboTax (the free, or $14.95 online version) because they have a pretty goof “deduction finder”, though I don’t know that you have many deductions based on what i see here.
For example, I didn’t realize that I could claim losses incurred from a house fire. That was worth quite a bit actually.
thanks for the heads up, looks like I fall into the 31-77K bracket, which should of been the same from last year.
last year I did a little moon-lighting that I claimed in 06 (made around 3K or so) but didn’t do any side jobs this past year. I need to dig through all my shit to make sure everything is right.
if worse comes to worse, I’ll be going somewhere to get them done.
thanks for the feedback. This stuff confuses the shit out of me
thanks for the info man, I’ll look into that a little closer. I should be claiming 0, but like I said… havent changed anything since 01 when I first started here. hopefully HR can help me out in getting the the bottom of this.
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But it works great. Has kept me spot on for ~3 years now; $100 refund / owe, except for this year.
