The Small Business Tax Help Blog

Archive for March, 2007

Question: Why is my federal withholding so low?

My 2008 income is approx. $150,000. I have filed as single with 1 exemption. When I go to the IRS website and complete the tax calculator my estimated 2008 tax is approx. $28,000. This calculation includes itemized deductions and 401K contributions. Based on this amount, I would expect to see a bi-monthly withholding of approx. $1,167. Yet, my paycheck has a federal withholding of only $600. I spoke with the payroll person internally and even with ADP, who processes our payroll, and they were unable to explain the discrepency, saying the system is connected to the IRS and the $600 amount is correct. How can this be accurate? Do I need to have addtional $ taken out of my check or am I missing something?

Answer: Unless you put something wrong on your W-4 or they transcribed it wrong, there is definitely something wrong with your withholding.

The tables are in IRS Publication 15 - you can download that at irs.gov - look at page 36-38. Your biweekly gross, even after allowing for all the deductions for pre-tax items and for your exemption, is most likely still around $5000 or more, and that would have a lot larger amount taken out than $600. It sounds like maybe something is coded wrong and they're not using the biweekly chart or something. If your biweekly pay is a lot less than that and a large amount of the $150K was in some sort of one-time payment, then their calculation might be right though. But in that case 25% should have been withheld from the one time payment, so even though that wouldn't have been quite enough your total withholding would at least be in range of what you owe.

All that said, if they did this all of 2007, then you are going to owe a ton of money when you file. Didn't you think it was a little strange that they were taking out so little?

Good luck.

Credit to hit some in pocketbook

A program launched by the federal government in 2009 to put a little more money into people's pockets during tough economic times will continue this year, and like last year, some taxpayers might find that less tax is being withheld than they prefer, according to the Internal Revenue Service.

Tax Tips: Withholding Calculator- General- January 2010 (ASL, Captions & Voice Over)

Question: Adecco Tax ID Number?

I saw this question was posted already, and not much help was given, but I was wondering also if any has the EIN Tax ID Number for Adecco.

I was told my W2 was mailed, but the local office failed to update my address; it’s “lost” at the moment, and they won’t send another until March, I need my refund urgently in order to pay bills, and can’t wait.

I realize using the last pay stub makes my return more prone to mistakes, i can call the IRS, etc. Please don’t respond with answers like that. If anyone has the # and can truly help, I would appreciate it. Thank you!
To those who have said “I” didn’t update my address, doesn’t know what it’s like to deal with Adecco…I contacted the office 4 times everytime my pay stub was incorrect and faxed the change in writing. It was finally updated last week from October

Answer: IF Adecco DOES NOT send you your W-2 in the mail BY January 31st, of 2008, you should report it to the IRS as soon as possible (within a week).

Adecco doesn't usually mail their W-2's until the end of the month which is a bit ridiculous in my opinion.

If you need your W-2 right away you need to go to your local Adecco office because they can print it there for you but you need to be present to recieve the information.

Fringe: Der Vaterland

Fringe "The Bishop Revival" Originally aired: January 28, 2010 To Download or Not To Download: To Download (if you have a $2.99 burning a hole in your pocket) Patrick Harbon/FOXHEY. YOU THERE, IN THE BACK. What do you think...

RAMMS†EIN - SONNE (lyrics & translation)

Question: Taxes/being paid under the table–PLEASE HELP!?

Here’s the situation. My boss has been paying me under the table for the past few weeks (I have been working there for the past few weeks). I work for a small business that he is the owner of. His tax accountant’s computer is fried and cannot input new data. It was fried before I started working there. So I haven’t filled out any forms yet and he’s been paying me the full hourly wage without any deductions because well, he can’t. My question is: when the accountant’s computer is back up and running and I fill out the taxforms, will I be forced to pay back the money that I made that wasn’t deducted? Like, will I have to pay him the difference? Is he legally allowed to do that?

Please answer as best you can.

Answer: He is not legally allowed to pay you without withholding taxes, whether or not he asks you to pay later. If he knew that he could not withhold taxes, then it was illegal for him to hire you, or anyone else.

Free tax workshop set for business owners

KENNEWICK -- A free tax workshop for small business owners is scheduled Jan. 21.The workshop, spo

Business Owners : Add $5,000 Instant Tax Deduction

Question: when i applied for my ein# it asked my dba i typed in “the swanky penguin” but they left out the “the”?

ok on my ein confirmation letter it just says “swanky penguin” i wanted it to be “the swanky penguin”. why did they leave off the “the”?
awsome! thanks vb

Answer: "The" is meaningless.

Local pilot club changes name, not focus

There is new nonprofit organization ready to serve the community on Fort Myers Beach. In actuality, the organization's name may be different but you may still recognize the same faces ... as former members of the Pilot International Club.

♫ Volk ans Gewehr - A. Pardun (English text included) ♫

Are blood donations taxable income?

Dear Tax Talk, Is money received from blood banks for donated blood taxable as earned income? — Joy Dear Joy, Ages ago, the tax law distinguished between earned and unearned income, as there was a maximum tax rate that applied to earned income.