22 and a RN...what will taxes be like?

[xonlyindreamsxRN]

ok so here's the deal. I'm 22 and a new grad RN . I live at home with my parents and plan to for the next two years to save up and move out, but until then i am wondering what taxes will be like at the end of the year and what i should claim. I was planning on claiming 0. Some friends of mine said that when they started working they owed like 4,000 at the end of the year. Does this sound right or were they may claiming the wrong thing, for example not getting much $ taken out of each check which may have led them to owe big? I just need some advice because i was recently hired and need ot fill out paperwork next week....can anyone help me out?

[Tweety, BSN, RN]

I've always claimed myself as one excemption and the end-of-the-year taxes, while quite high, have usually been pretty spot on with maybe a $500 refund, and even more now that I'm a homeowner.

However, if you're parents are claiming you as a dependent, which they might want to do since you are living there, that might change your filing status because I don't think you can claim yourself while someone else is also claiming you.

[ChristineN, BSN, RN]

Even if you are living at home, you should be able to file taxes independentally, based on the fact that you'll be making enough money as a nurse to be considered an independent (assuming you're working full-time). I know my parents had a similiar issue with me, in that I was still in nursing school, but my job as a PCT was bringing in to much money for them to claim me.

[HouTx, BSN, MSN, EdD]

Poor Baby - welcome to adulthood! :heartbeat

As a single person, you will see about a third of your income disappear into taxes . Of course, it varies depending on local & state tax rates. If you can afford it - go ahead and go with 0 dependents. Think of it as a 'forced' savings account. You can stash away your refund at the end of the year & build up a nice nest egg.

Look into other ways to lessen your tax burden - like contributing to your retirement plan. If you have a 30% tax rate - every dollar you shift into your 401k will only have a .70 impact on your take-home pay because these are 'pre-tax' deductions. Be sure you itemize your return so that you can deduct any interest on your student loans! If you decide to go on for a graduate degree, those costs will be mostly deductible also.

Lastly - seriously consider buying your own house/condo. Just about all of your mortgage payment will be deductible for the first few years.