hi...i started with agency work recently and just got my first check. whoa!! so much tax was taken off i couldn't believe it. when i first signed up with the agency and we had to get the paperwork done i thought i checked off the right box to indicate that i would sort out my taxes myself at the end of the year with my accountant. when i phoned my agency, they said "no, it's not done that way at all" . i was sure that that was how agency worked, that you are more or less an independent contractor and that it's up to you to manage your taxes.
can anyone offer any suggestions for me?
Aug 12, '03
When you filled out your W-4, what did you check?:
Married or single (which are you?)
How many deductions? (do you have children/other tax deductions such as grandkids)
It sounds like they are taking taxes out, so you must have filled out a W-4. IF you are single (actually, or married, as a matter of fact), you can "claim" up to 10 deductions without flagging the IRS. BUT, if you owe at the end of the year over a certain percentage (I don't remember what it is), there can be a penalty for under paying.
Remedy for that is to make quarterly tax payments.
I use paycheckcity.com to figure out what my taxes will be depending on how many deductions I claim on a W-4. I always seem to receive a hefty tax refund, and, according to my Dad (and you know, Dad is ALWAYS right!), I am withholding too much!
Aug 13, '03
It sounds like you are a W-2 employee for the agency that you work for. What you need to do is find an agency that does independent contracting. Once you do that then you will be able to establish a home office and use many available tax write-offs include milage, meals, travel expenses, etc