Ask Experts Questions for FREE Help !
Ask
    w1947b's Avatar
    w1947b Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Jun 11, 2008, 05:40 AM
    Fed and state tax
    Hello,

    I just got a new job and am having problems with my employer over my deductions. I usually claim 12 so that I get most of my money up front and then pay it at tax time in April. I usually get penalized but will take the hit as long as they are not using my tax money all year interest free. I have been doing this for close to 20 years with no problems. My question is this, my new employer says he will not alow me to claim 12 unless I prove to him that I have 12 dependents! He says that he will be liable for the taxes to Fed and state if I don't pay them. I told him that I pay my taxes just like any other hard working American, I just do it in April instead of all year long. I understand that he is liable for the Med. And SS but he is not responsible for my Fed and state taxes, that is between me and them. Do I have a leg to stand on here, and how would I go about forcing him to alow me to claim on my w-4 my what I wish?:mad:
    smearcase's Avatar
    smearcase Posts: 2,392, Reputation: 316
    Ultra Member
    		  
    #2

    Jun 11, 2008, 06:06 AM
    Frequently Asked Questions - 4.9 Life Insurance & Disability Insurance Proceeds

    From above: If the employee does not submit a valid W-4, the employer is instructed by IRS to withhold the maximum amount of tax (not a direct quote).

    I understand you don't want the govt to use your money interest free, but doesn't the penalty just about offset the interest you save. As I recall if taxes are underpaid they charge interest and penalties.

    I am not a tax expert, but I'm sure we'll have some comment soon.
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
    Expert
    		  
    #3

    Jun 11, 2008, 07:29 AM
    It used to be that employers were required to notify the IRS if you claimed 10 or more exemptions, but this is no longer the case. However, the IRS can review your withholding and may determine that your employer is required to reduce the number of allowances you are claiming. If every year you are having to pay back taxes and interest penalties then this may happen to you soon, if it hasn't already.

    I don't understand why you're willing to pay the IRS more than you have to. By paying interest charges at 1/2% per month you are raising your overall payments to the IRS.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #4

    Jun 12, 2008, 08:05 AM
    Unless you have a large family, claiming 12 exemptions is abusing the withholding system.

    This is a matter of a simple compromise. Claim the correct amount of withholdings allowed by the instructions with the W-4 and get on with your life.
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Part Year State Return and Unemployment Compensation from another state [ 1 Answers ]

I was living in Florida when I lost my job in June 2007 and started getting unemployment compensation from the State of Florida. I moved to Boston, MA in August 2007 and continued receiving the unemployment compensation from Florida. I got a new job in November 2007 in Boston, MA. So, my...

State Taxes withheld for wrong state on 1099-R [ 2 Answers ]

I was temporarily in another state, for 2 weeks, and closed a retirement account and received a 1099-R and they withheld the wrong state taxes. All of my employment is in MN and the taxes were withheld in VA. What do I do?

Can wife move out of state with child after divorce and residency in state [ 2 Answers ]

My wife and I are living in Ohio, have been residents for 9 months and have a 14 month old child. If we divorce and she would get custody, could she ever move out of the state

2 states: Can I credit state tax of one state to other state [ 1 Answers ]

I have 2 W-2. One from job in Mass. Mass state tax is withheld in that W-2. Then I moved to NC and got a new job in NC. NC state tax is withheld in this second jobs W-2. Both W-2 only have state tax withheld from their corresponding states. So can I credit taxes of one state to another and...

Federal return collected by state for state liability [ 1 Answers ]

I live in wi and filed married jointly I owe the wisc. Dep. Of revenue money but I have paid off the IRS . I filed my fed. Return electronicly and it was accepded, can the wisc .dep. Of rev. take my fed tax return? Or will my fed return be deposited in my account that I have specified with my...

View more questions Search