A friend, who runs a large business,sent me this warning today. It is a must for all working persons.
Found out our wonderful tax cut has a huge, big, whopping hole in it. Do you know that the withholdings for federal income tax purposes have been greatly increased, beginning effective date July 1 of this year? This while the tax rates have supposedly been cut.
When I went to do payroll today, Julia would have had to pay $52 more per pay period for withholdings if she did not increase her exemptions on her W-4 for the federal government. Got to David's paycheck and his withholdings increased from $111 for the pay period to $188, a whalloping 63.6% increase in withholding requirements. Wowzer!!!
I was truly upset.
So much for a tax cut. Seems we are to pay out money to the government so they can give it back to us in a huge tax return because of the "tax cut," just they really, really get to make their money off us without paying us interest. I just wanted to scream. I hate being bamboozled. Julia almost was in tears to hear that she was going to have to pay $646 more dollars in withholding over the last six months of the year.
I showed her the new federal withholding tables as of July 1 and she could see in the old book the zeroes all in a row where people did NOT have to pay withholding and now they have to pay a lot. Any way, I helped Julia get her state withholdings changed so that she ended up only $6 less rather than the $52 and I ended up with only $18 more in withholdings.
David took the position that W. is counting on and said, "I want Uncle Sam to give me a big check at the end of the year, save my money for me." He is going to be paying $910 more in withholdings over the next 6 months at zero interest so it can be handed back to him.
I surely hope he enjoys spending his $300 tax rebate check!!!!!!
Sibyl, thought you would appreciate the warning to watch and prepare if you so choose.