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Old 01-27-2010, 02:08 PM
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Federal Tax Withholding Question

According to my W-2 provided by my employer I made $11,643 last year and they only have $256.11 being withheld for federal income tax. I only claim 1 exemption (myself) and that small amount of withholding doesn't seem correct. Last year I made $15,911 and they withheld $1140.92. When I called my company I was told that because of Obama's stimulus plan they were not taking out as much in taxes and couldn't give me any more information.

Do these numbers seem correct or at least possible with only 1 exemption?



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Old 01-28-2010, 10:52 AM
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Yes! This is correct! When the Government was trying to rescue the economy they came up with the Stimulus package that basically made the employers withhold less money from their employees paycheck.

Thus, your Tax Federal Income Withholding was less than prior year and you got to keep more from your paycheck and Uncle Sam received less in Federal Income Taxes. So, during time of your tax filing, your potential tax refund, assuming no change in income and deductions from prior year, would be less than the tax refund you received from the prior year!

This is going to be quite troubling experience for a lot of taxpayers hungry for a large tax refund!



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Old 01-29-2010, 10:41 AM
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Yes, I agree with that statement completely! Taxpayers will be upset as this has not been explained to them very well!

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