2008, 2009 Federal Tax Withholding Info & Calculator

Paycheck Withholding

You may think we pay our taxes by April 15 but, this is not true. A little bit of what we owe is taken out of every check we get. What we pay in April is the difference between what we have already paid and the total amount we owe. A withholding tax is taken out of a salary, wage income, tips earned, pensions, retirement distributions and certain gambling winnings. Withholding is also taken out of interest and dividends earned.

Income Taxes Withheld on Wages

The amount of tax withheld from your wages depends on your marital status and how many dependents you claim. You have to file Form W-4 with your employer. If you do not do this, they assume you are a single person with no dependents.

Form W-2

Your employer must give you duplicate copies of your 2008 W-2 form by January 31, 2009. This is a statement of all of the wages you have earned for that year, the withheld income and the Social Security tax. If you no longer work at your place of employment before the year ends then, you may ask your employer with a written request within 30 days of leaving the job for your W-2 form.

Withholding Should Cover Your Estimated Tax

By filling out a W-4 form with your employer, you can adjust your withholding tax. The number of allowances you claim will either increase or decrease the amount of taxes being taken out of your check. On your W-4 you may also claim other allowances like the child tax credit and many others.

Are You Withholding Too Much or Too Little?

If you have to pay a large tax at the end of the year, you had too little held. If you are getting a large tax refund, you had too much held. If you are not expecting a tax refund, you may want to pay more each quarter to avoid paying so much at the end of the year.

Paycheck Tax Withholding Calculator

This valuable tool looks at your entire tax situation, including your other income and expenses, and figures out what you’ll actually owe on your taxes for the year. The calculator then determines how much you should have withheld to cover what you’ll owe for the year, without giving Uncle Sam a big loan.

Why Your Credit Score Is So Important

To many, the concept of their credit score is something that shrouded in mystery. Basically, it’s a score that determines your credit worthiness. The higher your credit score, the more credit worthy you are deemed to be.

If you are a consumer in the American economy, this is something that you need to know, whether you have a credit card or not. Your credit score, to a large extent, will determine your life style.

For one thing, it is the determining factor as to whether or not you get that loan. And if you manage to get a loan, it has a major impact on the amount of interest that you will pay. Your credit score will ascertain whether you are offered special credit card deals such as 0% apr cards, bonus miles, rewards program, and so on. And it determines whether you will be able to buy a home or if you will be forced to rent.

So, being that this score is evidently so important, what is it exactly that determines your credit score?

Your credit score is determined by a number of things. Among them, your payment history is probably the most important. A late payment on your bills drives down your credit score. The later it is, the more it is driven down. Multiple late payments drive this score down even further. Bottom line – if you don’t want your credit score to go down, don’t be late making your payments.

If you have a high debt to balance ratio, this will also drive your credit score down. That is, the closer you are to the maximum limit on your cards, the lower your credit score will tend to be.

Lastly, how long have you had credit? Or, more precisely, how long have you been in their database? A teenager, or a person who tends to purchase everything with cash, will most likely have a lower score than someone in their sixties who has had credit since they were in their twenties.

Read more from Susanna regarding credit card bad credit and college credit cards at her website.

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