Taxes For Nurses? Pay or Get Paid?

klone, MSN, RN · Jan 8, 2018

Nobody can answer that because it's highly individual. It depends on your family income, what deductibles you have, how many children you have, if any, and a myriad other factors. And then, of course, what status you claim in your W-4 with your employer will dictate how much they take out of each pay check, which will then dictate whether you get a refund or have to pay more in April.

AnnieOaklyRN, BSN, RN, EMT-P · Jan 8, 2018

As the other poster said, taxes are based on many things. They are based on your dedications as a whole, both standardized and itemized (you cannot have both, whichever one is higher is what you will deduct. Things you can deduct are property taxes, mortgage interest, student loan interest, PMI, some business expenses. They just past a new bill that will change some of these deductions so none of this is set in stone. Also you taxes are based on your income bracket, which you can look up on the IRS website. If you are single and making over 80K for example and you do not own a house, then yes you may take a hit in taxes. Also when you filled out your tax form when you got your job it depends on how much you claim, for most people it is zero.

You need to talk to a tax professional in order to have an idea about whether or not you will owe or how much you might get back. There are way to many variables for an online forum to give you that information!

Annie

SC_RNDude · Jan 8, 2018

First of all, find out where AnnieOakly says you can make $80k as a new grad nurse, and apply there!

It's actually not too difficult to approximate how much federal tax you will owe. It's estimated about 70% of taxpayers will take the standard deduction of $12,000 for single people (or $24,000 for married).

Let's say you make $65,000 a year. After the standard deduction, your taxable income is $53,000. Based on the new tax brackets (Here'''s how your tax bracket will change in 218) you'll owe:

10% of your first $9525 of income, which come to $952.

12% of your income between $9526 and $38,7000, which comes to $3500.

22% of your income from $38,701 to $53,000 (or up to $82,500), which comes to $3145.

952+3500+3145 = $7597. This is the amount you'll owe (about $3k less then before the new tax law), just for FEDERAL INCOME TAX. You'll have 26 paychecks in a year, so that comes to $292 a paycheck. Look on your paystub. If you are paying less, then you'll owe when you file taxes. If you are paying more, you'll get a refund.

Keep in mind, you'll still have SS tax, medicare tax, state and local taxes. SS and medicare come out of you paycheck. Nothing to owe or get a refund on at the end of the year. State and local taxes very quite a bit depending where you live. You may owe or get a refund on those.

If you get health insurance through your work, or a 401k or other retirement fund, your taxable income (the $53,000) will be less. If you have children, you will also get a tax break. If your deductions come to more then $12,000, then you will also owe a bit less.

Kudos to you for educating yourself about these matters now,. Over the years your knowledge will continue to grow. It'll benefit you in the long run.

I also feel strongly that if people paid more attention to what they are actually paying total in taxes, rather then measuring it once year in how much MORE they owe how how much they are getting back, we would hold our politicians more accountable for what they spend our money on.

RainMom · Jan 9, 2018

One thing to think about too is that getting a large tax refund should not really be a goal. Most people seem to celebrate when they get a nice chunk of money back not thinking about the fact that they just gave the government an interest-free loan instead of having that money to use or invest thru the year. The goal should be to come as close to breaking even as possible without having to pay more, imo.

RNKPCE · Jan 9, 2018

RainMom said:
One thing to think about too is that getting a large tax refund should not really be a goal. Most people seem to celebrate when they get a nice chunk of money back not thinking about the fact that they just gave the government an interest-free loan instead of having that money to use or invest thru the year. The goal should be to come as close to breaking even as possible without having to pay more, imo.

I'd like this post 100 times if I could! Each year we look ahead and see what has to be done tax wise so there are no surprise payments or large refunds.

KelRN215, BSN, RN · Jan 9, 2018

RainMom said:
One thing to think about too is that getting a large tax refund should not really be a goal. Most people seem to celebrate when they get a nice chunk of money back not thinking about the fact that they just gave the government an interest-free loan instead of having that money to use or invest thru the year. The goal should be to come as close to breaking even as possible without having to pay more, imo.

Yes, this. I claim 2 allowances on my W4 so that I pay less in taxes up front and avoid giving the government a large interest free loan. I get less back when I file my taxes at the end of the year than if I claimed 1 or 0 but that's more money that I've held onto throughout the year.

There is no answer to your question, OP. Some nurses owe the government at the end of the year, some get a refund and some break even. I typically get a refund from the federal government and owe the state a small amount.

AnnieOaklyRN, BSN, RN, EMT-P · Jan 9, 2018

SC_RNDude said:
First of all, find out where AnnieOakly says you can make $80k as a new grad nurse, and apply there!
It's actually not too difficult to approximate how much federal tax you will owe. It's estimated about 70% of taxpayers will take the standard deduction of $12,000 for single people (or $24,000 for married).
Let's say you make $65,000 a year. After the standard deduction, your taxable income is $53,000. Based on the new tax brackets (Here'''s how your tax bracket will change in 218) you'll owe:
10% of your first $9525 of income, which come to $952.
12% of your income between $9526 and $38,7000, which comes to $3500.
22% of your income from $38,701 to $53,000 (or up to $82,500), which comes to $3145.
952+3500+3145 = $7597. This is the amount you'll owe (about $3k less then before the new tax law), just for FEDERAL INCOME TAX. You'll have 26 paychecks in a year, so that comes to $292 a paycheck. Look on your paystub. If you are paying less, then you'll owe when you file taxes. If you are paying more, you'll get a refund.
Keep in mind, you'll still have SS tax, medicare tax, state and local taxes. SS and medicare come out of you paycheck. Nothing to owe or get a refund on at the end of the year. State and local taxes very quite a bit depending where you live. You may owe or get a refund on those.
If you get health insurance through your work, or a 401k or other retirement fund, your taxable income (the $53,000) will be less. If you have children, you will also get a tax break. If your deductions come to more then $12,000, then you will also owe a bit less.
Kudos to you for educating yourself about these matters now,. Over the years your knowledge will continue to grow. It'll benefit you in the long run.
I also feel strongly that if people paid more attention to what they are actually paying total in taxes, rather then measuring it once year in how much MORE they owe how how much they are getting back, we would hold our politicians more accountable for what they spend our money on.

Umm, maybe you should learn to read. My post never said anything about any new grad making 80K a year, it was broad example.

Annie

Meriwhen, ASN, BSN, MSN, RN · Jan 9, 2018

RainMom said:
One thing to think about too is that getting a large tax refund should not really be a goal. Most people seem to celebrate when they get a nice chunk of money back not thinking about the fact that they just gave the government an interest-free loan instead of having that money to use or invest thru the year. The goal should be to come as close to breaking even as possible without having to pay more, imo.

That, plus the fact that state and local (but not Federal, fortunately) tax refunds CAN be considered taxable income the following year. This is often the case if you itemize deductions...and I've had this happen to me across two states so far. You'd have to conduct your local tax preparer for the specifics.

IMO, it's better to aim for breaking even than to try to ring up large tax refunds.

klone, MSN, RN · Jan 9, 2018

AnnieOaklyRN said:
Umm, maybe you should learn to read. My post never said anything about any new grad making 80K a year, it was broad example.
Annie

That's all you took from his post?

Dusty77 · Jan 9, 2018

AnnieOaklyRN said:
As the other poster said, taxes are based on many things. They are based on your dedications as a whole, both standardized and itemized (you cannot have both, whichever one is higher is what you will deduct. Things you can deduct are property taxes, mortgage interest, student loan interest, PMI, some business expenses. They just past a new bill that will change some of these deductions so none of this is set in stone. Also you taxes are based on your income bracket, which you can look up on the IRS website. If you are single and making over 80K for example and you do not own a house, then yes you may take a hit in taxes. Also when you filled out your tax form when you got your job it depends on how much you claim, for most people it is zero.
You need to talk to a tax professional in order to have an idea about whether or not you will owe or how much you might get back. There are way to many variables for an online forum to give you that information!
Annie

What do you mean that a single making $80k without owning a home would "take a hit"?

SC_RNDude · Jan 9, 2018

AnnieOaklyRN said:
Umm, maybe you should learn to read. My post never said anything about any new grad making 80K a year, it was broad example.
Annie

Fair enough.

Before I let my less then adequate reading comprehension abilities get me in trouble again, explain how someone who is single, makes $80k, and doesn't own a home, "may take a hit in taxes". What do you mean exactly?