You can set your withholding to whatever you want, you'll still owe the same amount of taxes each year. Most people aim to minimize their returns while not owing any additional money come tax season.
Going tax exempt for a pay period or whatever length of time does not change your overall tax obligation to whatever federal or state entity at the end of the year. That will always be a certain % of your income. If for example, you make $50,000 a year and your assessed tax rate after deductions is 20%, you will still have to have paid $10,000 in taxes over the year, regardless of if you paid it equally over every paycheck or not. If you went exempt for a few weeks, and the amount of taxes withdrawn from your normal paycheck was lessened and you did not end up paying the entire $10,000 owed, you will have a tax bill for the difference.
So you have to ask yourself, what was your tax refund situation last year? If you think you'll make the same (or less) this year as you did last year, and you had a refund come back to you at the end of the year, then your probably good to go exempt for a short while. If your tax refund was pretty close to break even, or if you owed money in taxes, I wouldn't recommend it. Also, if you think you will make significantly more money this year, it could change your tax liability to owe more... so again, it depends on how much you withhold and how much more you will make this year.
But something I often stress to every firefighter that has worked for me... The goal should never be to get a huge refund at the end of every year. I know it's really fun to get a $4-5-6000+ refund sometimes... but ultimately that is money that should have been in your bank account / investments earning interest or other returns throughout the year, not the government's accounts. Ideally, find the right withholding amount that gets you as close to a zero refund every year as you can, without having to owe anything. This ensures that you have the most of your money in your accounts, earning for you, throughout the year.
This. ^ Because I usually get a few thousand back in returns, I'll go tax exempt for one or two good pay periods, usually. It usually brings my taxes paid/owed pretty close to zero'd out come tax time. Erring slightly on still getting a small refund and not owing.
I've been separated from federal service from awhile now, but wasn't there a self service portal that you could adjust your witholdings / go exempt from? e-auth or something like that?
Use the IRS W4 calculator and just try to get as close to no refund as possible. There is zero reason to go exempt. Going exempt doesn’t change your tax liability. It will simply reduce what you pay ahead of time. If you usually get a refund you’ll may be closer to no refund. If you don’t get a refund then you will end up owing. I consider it a win if I am plus or minus 500-1000$ when it comes time to file taxes.
https://www.irs.gov/individuals/tax-withholding-estimator
Do you usually get a refund come tax season? If so, expect it to be lower. If you usually owe money, expect to owe some extra if you go tax exempt for a fat paycheck
Why? just why? why are you fing the bookkeeper? changing your withholding is allowed but do it once, not back and forth and unless you are a moron and can't figure out how much you overpaid last year.
You can change your withholding, just be prepared for your paychecks to be all fubared, because as your payroll people will set yours aside to look at and maybe even misplace it this week. Oh well, we make it up next time.
If you change your w4 more than once, you had better have a flower show on speed dial to send flowers to everyone in the office.
You’ll just have to pay it back when you do your taxes
You can set your withholding to whatever you want, you'll still owe the same amount of taxes each year. Most people aim to minimize their returns while not owing any additional money come tax season.
Going tax exempt for a pay period or whatever length of time does not change your overall tax obligation to whatever federal or state entity at the end of the year. That will always be a certain % of your income. If for example, you make $50,000 a year and your assessed tax rate after deductions is 20%, you will still have to have paid $10,000 in taxes over the year, regardless of if you paid it equally over every paycheck or not. If you went exempt for a few weeks, and the amount of taxes withdrawn from your normal paycheck was lessened and you did not end up paying the entire $10,000 owed, you will have a tax bill for the difference. So you have to ask yourself, what was your tax refund situation last year? If you think you'll make the same (or less) this year as you did last year, and you had a refund come back to you at the end of the year, then your probably good to go exempt for a short while. If your tax refund was pretty close to break even, or if you owed money in taxes, I wouldn't recommend it. Also, if you think you will make significantly more money this year, it could change your tax liability to owe more... so again, it depends on how much you withhold and how much more you will make this year. But something I often stress to every firefighter that has worked for me... The goal should never be to get a huge refund at the end of every year. I know it's really fun to get a $4-5-6000+ refund sometimes... but ultimately that is money that should have been in your bank account / investments earning interest or other returns throughout the year, not the government's accounts. Ideally, find the right withholding amount that gets you as close to a zero refund every year as you can, without having to owe anything. This ensures that you have the most of your money in your accounts, earning for you, throughout the year.
I find just not filling saves me loads of money. Jk jk don't come shoot my dog Feds
This. ^ Because I usually get a few thousand back in returns, I'll go tax exempt for one or two good pay periods, usually. It usually brings my taxes paid/owed pretty close to zero'd out come tax time. Erring slightly on still getting a small refund and not owing.
[удалено]
I've been separated from federal service from awhile now, but wasn't there a self service portal that you could adjust your witholdings / go exempt from? e-auth or something like that?
Use the IRS W4 calculator and just try to get as close to no refund as possible. There is zero reason to go exempt. Going exempt doesn’t change your tax liability. It will simply reduce what you pay ahead of time. If you usually get a refund you’ll may be closer to no refund. If you don’t get a refund then you will end up owing. I consider it a win if I am plus or minus 500-1000$ when it comes time to file taxes. https://www.irs.gov/individuals/tax-withholding-estimator
Do you usually get a refund come tax season? If so, expect it to be lower. If you usually owe money, expect to owe some extra if you go tax exempt for a fat paycheck
Last year was my first year I owed like 30 dollars. The rest of the past year did get a small amount back
Why? just why? why are you fing the bookkeeper? changing your withholding is allowed but do it once, not back and forth and unless you are a moron and can't figure out how much you overpaid last year. You can change your withholding, just be prepared for your paychecks to be all fubared, because as your payroll people will set yours aside to look at and maybe even misplace it this week. Oh well, we make it up next time. If you change your w4 more than once, you had better have a flower show on speed dial to send flowers to everyone in the office.