Question

@jim_thompson5910
last two parts! can you please help me?:)

Answer 1

ok go for it

Answer 2

ok this part is going to use the previous part

what was the taxable income from the last part?

Answer 3

$9,325
:)

Answer 4

good, where does that number fall? which tax bracket are you in?

Answer 5

the last one?

Answer 6

see in the first column how it says "if your taxable income is...."

Answer 7

where does 9,325 fit in?

Answer 8

so we have to "$16,781.25 plus 28% of the excess over $82,400"

Answer 9

no, look in the first column

tell me which tax bracket 9,325 fits

is it the first tax bracket? second? third? or fourth?

Answer 10

fourth one

Answer 11

oh shoot! no no its the second one ahah

Answer 12

good catch

Answer 13

so what is the rule for this bracket?

Answer 14

$837.50 plus 15% of the excess of $8,375

Answer 15

good

Answer 16

so first you need to find the difference between 9,325 and 8,375

9325 - 8375 = ???

Answer 17

so 950

Answer 18

now take 15% of that to get

15% of 950 = 0.15*950 = ???

Answer 19

142.5?

Answer 20

?

Answer 21

good

Answer 22

now add that to 837.50

Answer 23

so 980?

Answer 24

perfect

Answer 25

that's your tax liability

Answer 26

that is the official amount you owe to the government

now go back to the witholdings chart

how much did you pay to the government?

Answer 27

1664.52?

Answer 28

so did you overpay? or underpay? or did you pay the perfect amount?

Answer 29

im not sure how do i know?

Answer 30

well you paid 1664.52 because the gov withheld this amount

but you really only owe 980

Answer 31

oh so overpay

Answer 32

yes good

Answer 33

that means you'll get a refund

the amount of the refund is the difference between what you paid and what you owe

Answer 34

Tax Refund = (Amount you paid) - (Amount you owe)

Tax Refund = (1664.52 ) - (980)

Tax Refund = 684.52

Answer 35

If the tax refund is negative, then you still owe the government tax money and you would send this money (probably in the form of a check) along with your filled out tax forms


In this case, the refund is positive, which means they will send you a check after the tax form is processed

Answer 36

so is this all for number 1?

Answer 37

hmm let me check

Answer 38

no not quite

Answer 39

#1 is asking about allowances

Answer 40

and the federal withholding

Answer 41

how can we figure this out??

Answer 42

you already did, when you circled the 2 and highlighted the 1664.52

Answer 43

there are 2 allowances (you and the child), which corresponds to a federal withholding of 1664.52

Answer 44

Oh! okay! ahah so what about number 2?

Answer 45

#2 is already answered (look above at how we determined if we get a refund or if we still owe tax money)

Answer 46

so what we discussed would be numbers 2 AND 3 actually?

Answer 47

you got it

Answer 48

oh gosh now number 4?

Answer 49

ok what do you want to change the allowances to?

Answer 50

im not sure? why would i change it?

Answer 51

let's say you have another kid or the kid you have lives elsewhere (eg: the kid gets old enough to live on his own)

Answer 52

those scenarios would change your allowances

Answer 53

so what should i put for number 4? im still not understanding?

Answer 54

I think this is where you can get creative and say "I want another kid, so my allowances go from 2 to 3"

Answer 55

then you recalculate your taxes and refund

make sense?

Answer 56

so how do i calculate all of that?

Answer 57

so say i have 3 allowences for the first part of number 4

Answer 58

for the second bullet my answer would be $1,109.42?

Answer 59

you would then calculate your new federal withholding

Answer 60

how
?

Answer 61

use the table from the last part

Answer 62

what do you mean? what table?

Answer 63

@jim_thompson5910

Answer 64

remember the table where you circled the 2 and highlighted the 1664.52?

it's that table

Answer 65

right so if i had 3 allowances now then the second bullet my answer would be $1,109.42?

Answer 66

what do you mean by "second bullet"?

Answer 67

?

Answer 68

you said "then the second bullet my answer"

what did you mean by "second bullet"?

Answer 69

oh ahah this

Answer 70

oh i see

Answer 71

first bullet: the new federal withholding is $1,109.42 (you find this from the table)

second bullet: this is where you calculate the new refund

third bullet: an explanation as to why the refund changes

Answer 72

that's the basic format of your answer

Answer 73

i see but what im saying is how do i calculate all of this?

Answer 74

remember how we calculated the refund for the allowance of 2 people?

Answer 75

hold on let me see

Answer 76

ugh im getting so mad :( i dont know...

Answer 77

it's ok, don't panic

just take things one step at a time

Answer 78

what was the tax liability?

Answer 79

for 3 allowences?

Answer 80

no don't worry about the allowances for now

Answer 81

what was the tax liability?

Answer 82

980?

Answer 83

the new withholding is $1,109.42

so what's the new refund?

Answer 84

idk?

Answer 85

hint:

Tax Refund = (Amount you paid) - (Amount you owe)

Answer 86

$1,109.42 - (unknown)
?

Answer 87

amount you owe is the tax liability

Answer 88

idk how to find out how much i owe

Answer 89

you just told me the tax liability a few posts ago

Answer 90

what?980?

Answer 91

yes good, so it is

$1,109.42 - 980 = ???

Answer 92

129.42?

Answer 93

so this is the new refund

Answer 94

what was the old refund?

Answer 95

684.52