Hello,

I have an offer of $100K in a California based company. I wanted to know how much tax will I end up paying yearly so that I can figure out what will be my take home salary. I am married but my wife is not working currently. Also suggest me under which head( married filing jointly, married filing single etc) should I be filing my taxe return to save tax.

I can give you a rough estimate for taxes, but remember that there are other deductions that will reduce your take home even further - such as medical, dental, and 401(k) plan contributions.

Taxes would include:
1. Federal income tax - about $13K/year

2. CA State income tax: about $6K. This assumes you live or work in CA - you said the company is "California based," so I assume that's where you will be living.

3. FICA (social security & Medicare): about $5800.

These numbers may all be affected if you contribute to a 401(k) or medical/dental.

It is almost always best to file as Married Filing Jointly, as opposed to filing separate. Exceptions typically occur if one of you has very high medical or other deductions. It's always recommended to run the numbers both ways and see which works best for you.

Thanks a lot ebaines for such a detailed reply. I would be working and living in California. You have mentioned that the take home will also be affected by 401(k) and medical/dental. Could you tell me what's the minimum percentage that I need to contribute towards 401(k) (again so that I can maximize my take home). Also when you said medical/dental, were you referring to the annual premiums for the same.

401(k) contributions are whatever you want them to be, from $0 up to a max of $16.5K/year. This is savings for your retirement and the general recommendation is to try to contribute 10% if you can, but if not try to contribute at least the percentage that your company matches.

Medical/dental means the employee contribution to the company's medical and/or dental plans. The premiums depend on your company's plan. You can ask he HR department about it.

Thanks again ebaines! Really appreciate your help.