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Friday, September 30, 2005

Well, I guess some money is better than no money, right?

So I got my first paycheque today, right on schedule!

That's the good news.

The bad news is that, after taxes, it's much, MUCH less than I expected. Fully 27% of my gross has gone to taxes (my extra benefits also eat up a little money, but only about 2% of my gross). Is this normal? I can't possibly be in the 25% tax bracket, with what I earn. I know I'll get a lot back come tax season, but damn! Right now, after I deduct my transportation costs, I'm making about what I made last year, between my part-time job and my teaching salary.

So, there goes my plan to pay off a chunk of the $2000 I had to charge to my credit card this past month, while I was waiting for this fucking paycheque. Not to mention my computer. And all the debt I've been carrying for all these many, many years.

link | posted by La Lecturess at 1:10 PM |


Blogger RH commented at 2:15 PM~  

And you wonder why I became a libertarian??

Just wait until you buy a house...

Blogger Morton T Fogg commented at 3:07 PM~  

Are you taking no deductions? You might be in for a big refund come April, after all.

Blogger Helen commented at 6:47 PM~  

This comment has been removed by a blog administrator.

Anonymous Anonymous commented at 8:53 PM~  

Check your number of exemptions. 2 is common even for single people for some reason, once I had 3 and I have no clue why. I prefer to hang onto my money and pay more at tax time, if possible.

Also, are they deducting state income taxes for... the state you're working in? They shouldn't, if your address is in that other state.


Blogger La Lecturess commented at 11:18 PM~  

I have two exemptions. I've never quite figured out how I could sign up for *fewer* than two, though I'd sure like to.

And yes: I'm getting taxed by the federal, state, and municipal gov'ts (state & muni of Big Urban). Can I correct that? I know that, come tax time, my city of residence will also tax me up the ass.

(Next spring I'm looking at filing taxes in not one, not two, but THREE states. Kill me now.)

Anonymous New Kid on the Hallway commented at 10:47 AM~  

Talk to your HR people - we had a form we could fill out to change our number of exemptions, whenever we wanted. But don't more exemptions mean you pay *less* tax? I thought that when we ended up dinged at tax time, and I switched stuff around, I took *fewer* exemptions so that they took out more taxes (so we didn't owe so much at the end of the year). Because isn't the exemption from paying so much tax to start with?

(But I would be very happy to be proved wrong here - I'm pretty vague about taxes, except that they have to be paid by April 15!)

And yes, the multiple state tax thing is a HUGE pain in the ass. Get the Quicken software! It makes life soooooo much easier.

Anonymous Anonymous commented at 6:18 PM~  

Exemptions are the number of people you'll be getting deductions for. So if you have 3 exemptions, they take *less* money out of your paycheck, but if you're single with no kids, you'll end up paying more come tax time.

I think they figure the exemptions pretty liberally; generally if you have 1 exemption just for yourself, you'll be getting a lot of money back. Of course if you mix state taxes in, it gets all confusing.

I'm not sure what the tax laws are for your state(s), but it's possible they require deduction for full-time employees, even if they are out of state. Also, perhaps you are required to pay tax in that state because it's where you're working full-time. Hopefully you don't have to pay local tax in BOTH states, you really shouldn't -- unless your employer state taxes you based on where you work, and your residence state taxes you based on where you live.

But even if that were the case, you should be okay -- states generally let you deduct taxes you've paid federally and in other states.

In my case, I'm able to *not* have local taxes taken out in my school state when I'm working part-time (during the year), but I apparently have no say in the matter during the summer, when I work full time (and they automatically start withholding taxes). I think it only works for me because my permanent address is still in my original home state, AND I make my school state provide me a full refund because I'm not a resident (based on the grounds that I am a full-time student, I don't think I have to claim residency here).

Probably doesn't work that way for you though -- I assume you can keep your residency where you actually live, but I doubt you'd be exempt from state taxes where you work.


Blogger La Lecturess commented at 1:31 AM~  

Thanks for the advice, folks (and esp. from you, bro). I guess I'll try to swing by Payroll on Monday and change my exemption status and I'll also look into whether I really need to be paying state & local taxes. Really, even getting back an extra $100-200 a month would make me extremely happy.

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