Calculate Federal Withholding Taxes 2018 - 2019
In the United States, withholding taxes on wages by employers is required by the federal government as well as most state, and some local governments.
Taxes withheld include:
- Federal Income Tax
- Social Security Tax
- Medicare Taxes
- State Income Tax
- Certain other levies by some states.
By law, employees must provide their employer with a Federal Form W-4. This form provides the employer with the following information:
- Employees Social Security Number
- Declared Number of Withholding Allowances
There are important factors that impact the calculation of your federal income taxes.
These factors include: marital status, number of withholding allowances (exemptions), and amount of your taxable earnings during the year.
Other factors include tax reductions such as Public Employees Retirement System (PERS) and TIAA/CREF retirement contributions that combine to determine what amount of federal income tax is owed.
You may also Calculate your taxes to be withheld from your employee paycheck
The Internal Revenue Service (IRS) on behalf of the federal government, requires employers in the United States to withhold Federal Income Taxes, Social Security Taxes, and Medicare Taxes from employee wages.
In general, employers are mandated to withhold taxes on an employee's earnings before any other deductions are taken out. These paycheck earnings prior to withholdings being taken out are considered to be gross pay or income.
Calculate Federal Tax Withheld From Payroll
Withholding allowances includes personal exemptions, itemized deductions, plus losses, or credits.
Employers are entitled to rely on employee declarations on Form W-4 unless they know they are aware of inaccuracies.
The following steps describe how to calculate your federal income taxes:
- Determine the value of your total withholding allowances (exemptions) as claimed on your current W-4 Form by multiplying each allowance (exemption) by the semi-monthly amount of $158.33.
- Subtract the amount of any salary reductions, such as PERS, TIAA/CREF, or health insurance premium from your total semi-monthly gross earnings.
- Subtract STEP 1 from STEP 2 to determine your taxable gross wages.
- Use the calculator above to calculate the amount of your federal income taxes. Be sure to select the proper setting based upon your marital status (single or married) as marked on your current W-4 Form.
You can then file your taxes traditionally or do your taxes online using tax software like TurboTax or H&R Block when you are ready to file.
If you do not have enough taxes withheld over the year, or fail to pay enough in estimated taxes, you may be subjected to a penalty for underpaying with your tax payments.
Calculate Federal Tax Withholding Based on Salary
In a larger numeric task, calculating your federal taxes to be withheld based on salary is similar to weekly withholding calculations but obviously come with a much bigger figures.