How Your Paycheck IMPACTS Your Tax REFUND 💵 Tax Withholdings FULLY Explained
HTML-код
- Опубликовано: 5 сен 2024
- Learn How Your Paycheck Works - Tax Withholdings Explained - From Your Paycheck To Your Tax Return (How Your Paycheck Works) Full examples shown in the video.
Other videos related to this series that you might find helpful:
• W-4 2020 Explained! (D... - Preview of upcoming 2020 W-4
• How Do Tax Withholding... - How Tax Withholdings Work
• How To Project Taxable... - How to project your taxable Income
• IRS Tax Withholdings C... - IRS Withholdings Calculator Walkthrough
In this video you learn how:
• Your paycheck affects your tax return
• Your paycheck affects your tax refund
• How your W-4 impacts your paycheck
• How your paycheck impacts your W-2
• Why it is so important to know this stuff.
♦Check out my Income tax playlist here:
• Income Taxes Explained
♦ Investing in the stock market!: goo.gl/yVAoES
♦ Save money, budget, build wealth and improve your financial position at any age: goo.gl/E97nJj
♦ Learn more about how federal income taxes work: goo.gl/D1hCX1
♦ Ways to improve your life at any age: goo.gl/uq72bu
Subscribe for our future weekly videos. New videos typically every Sunday or Wednesday. Do not forget to help out a friend and share this information with them as well.
You can find our content on other internet platforms such as:
My Website: Moneyandlifetv.com
Twitter: / mkchip123
Facebook: / moneyandlifetv
**Disclaimer**
All of the information in this video is presented for educational purposes only and should not be taken as financial, tax, or investing advice by any means. I am not a financial adviser. Although I am a CPA I cannot advise someone for tax purposes without knowing their complete tax situation.
You should always do your own research before implementing new ideas or strategies. If you are unsure of what to do you should consider consulting with a financial adviser or tax accountant such as an Enrolled Agent, or Certified Public Accountant in the area in which you live.
Thanks for taking time to check out this video, and our channel. Have a great day and we will see you in the next video!
I'm ashamed to say how old I am and how long I've been in the workforce before really trying to get this info. I felt that this stuff was too complicated and left it to professionals to process my returns.Thank you for your video.
My pleasure, it is complicated, but once you have an understanding of the basics it gets a lot easier :)
This video is needed for people entering the workforce. I remember having to explain this to a new employee. She wanted to opt out of paying Federal Withholding, Medicare and Social Security taxes.
Lisa H thanks for sharing your experience. I have so many people telling me they want nothing withheld which is usually not the smartest move. Some taxes and deductions you cannot avoid. It’s funny how differently they start thinking about taxes once it is coming out of their own pocket.
Lisa H I want to opt out of all payroll taxes too!!
That would be a God send lol Please let me opt out of social security I could be so much better off.
Not all heroes wear capes. Keep up the great work!
Haha, thanks Jonathan this comment made my day.
Another very good video. I remember filling it out in my first summer job and didn't know anything about tax. Since the summer job only lasts a summer but the withholding calculation assumes as if you are making the same pay for the entire year, tends to over withhold the tax. It's very useful to know this at your first job and for people to not get intimidated with it. It is just an estimate and numbers get corrected when the final tax form is being filed.
Excellent point Emikami1, withholdings are truly an estimate. People often don't feel the need to file a tax return if they do not make much money. A summer job is a great example of that. However, since their income is so low they will undoubtedly owe no tax, therefore they should consider filing a tax return to get there money back or claim exempt on their W-4 assuming that is the only income they expect to receive for the entire year. Knowing the filing requirements is very important, but we often don't figure that out until later on.
Mike can you make a video on how to avoid a tax refund.Some people get a big tax refund and it's the money they should have in their pockets already, therefore giving government an interest free loan.
That would be a great topic idea for a video thanks for sharing. I was thinking about doing a tax Q&A type of video perhaps I can address that question during the video.
**I had to re-upload this video due to some additional edits that needed to be made. Thank you to everyone looking out for me I really appreciate it more than you know. Sorry for any confusion this may have caused.
oh haha, I was confused when I saw uploaded 14 min ago.
Here's the link to that website. smartasset.com/taxes/paycheck-calculator
I was using it to see how much money I need to make at an hourly job to pay my bills after taxes. Going to use my spare time to start a side hustle.
Nice! Thanks so much Nick. What type of side hustle are you thinking of starting?
@@MoneyandLifeTV I'm starting an affiliate marketing business and a youtube channel.
My goal is to eventually live off my affiliate marketing income and invest everything from youtube. Both are long term plays.
Beautiful Nick, beautiful. I like the sound of that.
So what do you do if you lost all your pay stubs & you haven't filed taxes in a couple years??
@Money and Life TV ! I would like more videos about taxes and how best to maximize actual access to earnings ! Thanks for what you share. Much appreciated!
Thank you Lucy Lu! I always appreciate your support. Can you elaborate a bit more when you say "access to earnings" I don't think I fully follow. Can you give me an example? Thanks!
@@MoneyandLifeTVI was referring to this video, where you discuss earned income and increasing ones refund/earnings. Hopefully, by reply answers your question. Thanks again.
Thanks Lucy Lu, I think I follow now. I was planning to put a video together at some point that better explains tax refunds and how to reduce or increase the refund amount based on ones earnings.
Thank you in advance for continuing to support the content I produce on this channel it means the world to me. Please feel free to share this video with others, especially those who are just entering the work force. If you want to see more videos in this particular series please Crush that LIKE button or drop a COMMENT below. Thank you!
Other videos related to this series that you might find helpful:
ruclips.net/video/Hp_kCkiboh0/видео.html - Preview of upcoming 2020 W-4
ruclips.net/video/qKTYi2Xakx0/видео.html - How Tax Withholdings Work
ruclips.net/video/JB2J6XIt6xA/видео.html - How to project your taxable Income
ruclips.net/video/Ud9PW4fhGg0/видео.html - IRS Withholdings Calculator Walkthrough
Keep up the good work! Im on Track to calculate my taxes
Mr Fathead, nice job brother! It sounds like watching all of these nerdy tax videos is paying off 😂
@@MoneyandLifeTV the IRS has changed the view of the withholding calculator. I follow your explanation of the website better than trying to figure it out on my own.
When I filled out a W-4 before they changed it in 2020 to the different new form. What I would do is I would change my allowances up to 12 or so. And then that would make my paycheck the biggest as possible with hardly any federal withholding. I did my taxes and I did not work the entire year but most of it and I didn't get a refund or barely got any at all not exactly sure now with the new form I can't do that because they took that option out. And I don't understand everything and how this works but I don't want any federal tax taken out or the minimal possible. So at $29 an hour I now have changed my W-4 online 4C only as a single status and I put $17,000 on that line and then that brings my federal tax withholding down to very little only $40 or something per check.
Now at the end of the tax year am I going to be penalized or have a big surprise or is this going to be okay to do because with the new form and not being able to change the allowances there's no way to bring my federal tax down so they don't take all this federal tax out and I don't care about a refund? Please help thanks.
My friend told me that in the US, the government take a big chunk out of your paycheck for "taxes"
So, you have to pay the government if you wanna work? In MX government don't do that. But Cartel does.
thank you man, really appreciated this clear info
Keep up the great 👍 work. I totally understand alot better about taxes because of your videos!! Thanks 😊
Thanks! this was really useful!
So glad to hear that. Thank you ahmad!
KEEP UP THE GREAT WORK. THANKS FOR THIS AWESOME VIDEO.
Thank you for your guidance
You're most welcome
This was great. Thank you!
Why now the federal government is take less taxes normally for the w-4 throughout the year?
Brooo!! Can you please make a new video and kinda explain it a bit more. I’m still a bit confused. Does it benefit me if I get extra money withheld from each paycheck? What’s the difference between ‘Deductions’ & ‘Extra Withholding’
Great question. A deduction is something that reduces the tax you owe. Withholding is more like a payment to the IRS and not a deduction. If you withhold more than the tax you owe you will get a tax refund when you file your tax return. If you do not withhold enough taxes you will owe tax when you go to file your tax return. The amount of tax you owe is driven by your total taxable income less deductions, etc. There is no great benefit to drastically over witholding your taxes. It just means the IRS gets to hold on to more of your money then they need to.
Some people I know get only 80$ in tax return while another half of ppl I know get $1,000 in return. I guess everyone’s withholdings are different.
Hi Nytellem, that is correct. Everyones withholdings and life situation are drastically different. The withholdings from one's paycheck generally only accounts for that one job, but people these days have multiple jobs or side hustles and/or other circumstances that would not be reflected properly in one's w-2 withholdings. Withholding tables are an estimate at best which is why some people end up getting back a huge refund or owe a significant balance each year. There are so many variables there is no one size fits all answer. Without doing some sort of tax planning there is no way to be certain if your withholding too much or too little unless your life circumstances and income basically doesn't change.
How does 401k and ESPP affect your tax return? I tried looking around on google but it just tells me the same generic info I keep getting.
Ya, ESPP is professional level knowledge that you generally will not find on Google. You can try searching youtube as well. However, you might consider working with a CPA. Most people are not going to give that information away for free and if they do it is likely going to be limited information.
@@MoneyandLifeTV
I generally don't like spending money unless it saves me time in exchange for my headache of researching it myself. It would seem this is one of those issues.
Question taxes we pay for the year, how do we find that amount for the current year? (Like your 2,900$ example before the year ends)
Also, can we make allowance changes to w4 anytime of the year and if so because of what I’ve learned from you ima get more of a refund than I want, can I adjust w4 to no longer take taxes out for the year if I know I reached the taxes owed for the year like the 2,900$ example that you shared?
Sorry I went a couple videos back and you pretty much answered my question oops but thank you so much for your advice
Awesome, thanks Cali, i'm hear if you need me :) I try to respond to as many viewer questions as I possibly can.
so when you got witheld that is subtracted from the tax liability right
Thank you
Mike, Good call on your part on the edit... You 1st release had too much of your personal info.....
Ya Wasn’t my brightest moment but glad I took it down 😀
So claim 0 will make you get more income tax refund ? Or how can you make the withholding tax more? Thanks
Is there a standard percentage that I should withhold from each check? Like based on annual income? Example: Let’s say I make 50k annually, should I be withholding 5k by years end?
How is it that they withhold more than needed? Is it because of mis calculations on your employers part? Or is there something else that effect how much is withheld?
Question... Coming into my new job, I still didn't know about W4 until now, so I guess I exempted taxes from my paychecks. So... Me right now doing taxes through TurboTax I have zero tax withheld on my W2. I usually do TurboTax myself, but never came across this till now.
-How do I file my taxes now? There's a good sum of taxes due on the tip left screen.
-And also, what do I put in when it asks for Estimated Tax Payments?
Can you make a video on how does $100 on w4 line 6 affect my tax return and where do you get that number (on 1040 line 15) come from? Is that a tax bracket?
Can you teach how to fill out taxes to start a tax business?
Actually, I would only show the Taxes portion of the pay stub.. The 401k and the Adjustments to Net Pay could be deleted..
hello, what are your thoughts on exempting federal tax on an employees paycheck. Then at the end of the year using money generated from assets to pay taxes.
Great question. I'm working on a Q&A type of video for next weekend (10/18) I will touch on this.
What about state withholdings?
I was thinking paying zero taxes till the end of year and taking the portion out they take and putting it in savings to gain a small amount. Can I do that? So others not paying any taxes till the end of the year?
Thank you. Thank you.
Welcome boss. Thanks :)
How do I figure my total tax number?
They aren’t taken state or fed out for me
Mike, due to changes in 2020 tax code, we added an additional withholding for my wife but the net result was a decent increase in her take home pay. According to the IRS calculator, I need to add a sizeable additional withholding to my W-4, but I'm trying to determine how it will impact my net pay. Any suggestions on calculator tools that may assist?
Nice vid!
Thank you for sharing.
Thanks my frugal life!
Could you make one of these videos for 1099’s?
Great suggestion, thanks!
Federal government taking over 3k and I have 0! On my tax information!!!
not fully explained
only if tax and personal finance was taught in middle and high school.. there would be much more productive individuals in today’s society in my opintion
🐦
Chewie, usually I would pissed me if someone flipped me the bird, but not on this channel brother, Chipper appreciates it. 🍺
They do teach tax in school.... You were just not paying attention to teachers.... use your listening ears
They changed the tax form recently last year for the W-4 so no they didn't teach this in school.
I was never taught this in school
i really like you and like most of your videos, but i was shocked that you made this video... this is the most basic information that anyone should be able to figure out themselves, very easily and quickly... naturally even, as just part of the process.
It feels like you made a brain dead easy video mostly to generate youtube revenue without requiring much effort on your part and without providing any real value to say ~ 95%+ of your subscribers. It is the attention economy, and I feel you exploited my time.
Yes, the title gives an indication, but I figured surely, it can’t be as basic as just that, otherwise why would he make such a video... surely there is some nugget at the end or something.... but NOPE.
I hope you don’t go this basic again in the future.
I don’t think i have ever thumb-downed one of your videos and thumb up most of them, but this was a deserved thumb down. please provide a higher value:our-time ratio in the future. You usually do... some more than others, but I don’t remember one this low from you in the past. If it was frequent, i would be out of here. I’m here to give you revenue as long as you are providing at least reasonable value back for my time.
If you do feel compelled to make something this basic in the future for some reason, PLEASE AT LEAST have a prominent disclaimer at the beginning that it is as such and advise anyone else to move along and not spend their precious time.
I just spent all this time writing this.... much more of my time.... to give you valuable feedback to consider to improve your channel and ultimately your revenue in the long run. it would have been easier for me to give a thumbs down and move on. but you are a nice guy and i like you and you usually do better.
Hi Nishiki, I appreciate the feedback even though you did not enjoy the video. I can certainly add disclaimers on videos if they are intended for beginners or people who are new to a particular financial subject.
Although you may know taxes and withholdings very well it is not safe to assume that others are as versed in this subject as you. In fact from speaking at colleges, and with adults of all ages I have found that most of them do not have a good understanding of what you and I might consider to be the most basic of tax concepts.
Please note that none of the videos I produce on this channel are to exploit people's time. I make virtually nothing on this video compared to how much time I put into creating this video. I provide a tremendous amount of free information including handouts, downloads, etc on this channel. Most of it I create myself. I do not create videos for the sake of getting clicks and views. That is not the type of person I am so please do not place me in that category. Can I make everyone happy? Of course not, but please know that I would never make a video to purposely waste your time or anyone else.
If I wanted to exploit people's time I would do nothing but produce reactionary videos or constantly be making videos about how to make money, reading news articles to you, etc. VS actually trying to teach people something
Nonetheless you did provide some feedback here that I will consider for future videos so thank you for taking the time to offer that up. I know that must have taken a good amount of time to write, and I will assume you mean well by it so thank you.
Wrong. If you want to talk about "exploited time," go watch stupid brain-cell killing "reactional videos" that turn your sponge into a molten puddle or fake gurus giving financial advice in contrast to Mike having credibility of being a CPA.