Payroll

oops, i mean 'change the number of dependants claimed' in the middle of the year.

IIRC they can do this every day if they want to. All they do is hand you another W-4 and you must abide by it unless the IRS has sent you a notice, then you do what the notice says.

The number of dependents is one way for a person to control the amount of Federal tax withheld. A single person with a big mortgage might claim 6 dependents, having none in reality. I think if an employee claims more than 10 you have to send a copy in to IRS, or Social Security Administration. Just like a head of household claiming zero exemptions because they need more tax taken out of his checks.

Back in the early 80s a coworker claimed 99. He took the extra money and invested it. He filed his tax return as soon as the W2s were ready and paid his taxes in full. The IRS doesn't want this happening. So hence the rule for dependents claimed exceeding 10.

TK

Golden California Girls wrote:

The send it in ten rule went away last year. The IRS now uses a computer check to be sure the worker is paying enough. Employer will get a letter if enough isn't being collected in advance.

Yes, if everyone paid on April 15, the US would be bankrupt. Net 365, what a concept.

Ummm.. NOT net 365. More like net 105 (Dec 31 end of year, Apr 15 collections).

Quarterly payments, and withholding, were introduced after WWII.

When the income tax went into effect in California, Governor Reagan refused to allow payroll deductions. He said he wanted people to see, and pay, the total at one time. He wanted it to "hurt."

wow - thanks for all the info. a couple more for the payroll newbie:

1. what are the forms that need to get filed with the feds? and how often are they filed? if the filing times/dates vary, what determines the schedules?

1. what are the forms that need to get filed with the states (CA), and how often are they filed? if the filing times/dates vary, what determines the schedules?

thanks aga> I must have missed that notification. In all of the years it was in

1. If you do not have the current Publication 15 (Circular E) you need to download it from
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   It has this information.

1. You will need to c> wow - thanks for all the info. a couple more for the payroll newbie: >

thank you, will do. since this is the first time i'll be cutting a check, i'm wondering if someone would be kind enough to check my numbers? the employee is very simple -

first paycheck for this employee single with 1 allowance. hourly wage of 11 / hr. total hours are 63.5 State is CA

these are the numbers i get:

Gross - 698.5 Fed withholding - 56 Social Sec Employee - 43.31 Medicare Employee - 10.13 CA - withholding - 5.69 CA - disability - 5.59

Net amount 577.78

do these numbers look right? i'm using Quickbooks payroll service, btw.

TKnTexas wrote:

Is this a weekly or bi weekly check?

If it is a bi-weekly check you match PaycheckCity.com.

If it is a weekly check, that website gives me 82.05 for federal and 20.51 for CA state withholdings. Otherwise the numbers match when using a weekly rate. Also, you should have an OT premium if weekly.

hi,

this is bi-weekly. and i did run it against paycheckcity.com, and it did seem to match, which gives me peace of mind.

paycheckcity has an option to "Round Federal Withholding", whereas Quickbooks seems to just round automatically. is this of consequence?

Laura wrote:

GIGO - Garbage In, Gospel Out

If QB payroll provides these numbers, you can take them to the bank.

Let QB do its rounding thing.

Actually, there is a logic to that.

I was browsing a book at the local bookstore (forgot the title, but it was a book arguing for a 'flat tax'), and the author brought up the point that BEFORE withholding, folks could tell you exactly how much they paid in income tax. It was a check they sent out like any other bill, and if the rate went up they knew it, and were vocal about it. They contrasted it to today, where, thanks to withholding and good PR, folks on April 15th are more likely to know how much of a refund they expect.

Try it. Ask a good buddy what they spend on taxes in April and wait to here - "I'm not paying anything, the IRS is sending me back x dollars".

It's a testament to our educational system.