Question about taxes and paychecks

I have been out of work since March and went back part-time this week (only working 2 days a week). I have a few questions for those that know about this stuff?

1) If you are married, do you HAVE to file together? Last year, DH and I had only been married for 6 months so we filed seperately.

2) Being I am only working part-time, should I claim married 1? Or is that not a good idea since that is what DH claims. (I would like to get as much $$$ as I can out of my paycheck so we can use it to do things around the house and pay off some bills, but I also dont want to owe at the end of the year).

3) I know what you claim causes you to get more or less out of your check. It seems that when you get a paycheck, almost 1/2 of it is taken out for taxes and the more dependants you claim the less $$$ is taken out. Is there a percentage taken out associated with the dependants you claim (meaning how do they figure out how much is taken out based on dependants...is it the same % for everyone or based on salary)?

TIA. I'm just not sure how this will work now that I am working only part-time.

Message edited 9/12/2007 1:41:21 PM.

Re: Question about taxes and paychecks

1. You can file as "married but filing separately"

2. I always claim "married, but withhold at higher single rate" and 0. I make a high salary and rarely get a refund. I'd rather overpay a bit and get it back than have to owe even more. Sure, there are plenty of people who say "but you're giving an interest-free loan to the government and could be earning interest on that money!" True, but (a) who really is going to take that exact amount of money and put it in an interest bearing account? and (b) I save plenty on my own anyway. I'm not worried about these few hundred dollars extra. Most tax accountants I've spoken to tend to agree with me. I am related to two accountants and both always withhold at the single / 0 rate - even though both are married with children. HOWEVER, this is a totally personal decision. I'm sure some of the more tax-saavy on the board or the accountants on the board can shed more light on this than I can!

3. I honestly don't know the answer. SORRY!

Re: Question about taxes and paychecks

1 - you have to file married, but can file married filing separately.

2 - The choice is yours - since you are working part time it might be ok to claim married 1

3 - it is not an exact percentage - you can talk to your payroll department and they should be able to tell you how much will be taken out if you change your witthholding.

Re: Question about taxes and paychecks

Re: Question about taxes and paychecks

to answer #2 and #3, you can use a paycheck calculator to determine the difference in your paycheck whether you file married 0, 1, 2 etc.

Paycheck calculator

Re: Question about taxes and paychecks

Oh thanks...this calculator is extremely helpful.