Owing more than expected on Federal from NYC W-2?

DE201 · #1 (**permalink**) 02-20-2014, 11:10 PM

Hi All,
First post on the board, thanks in advance to anyone willing to help/give advice.
So long story short, if I'm following correctly - I seem to owe taxes to Federal due to my NYC wages but this is why I feel like it seems unreasonable:
I live in NJ. Worked 8.5 months in NJ - after putting in around $46,000 of income, my federal return sits at around $2,400. I then put in my NYC W-2, where I got a new job and worked the other 3.5 months, earning around $21,000. Now, I mistakenly put "2" as my exemption so yes, I had less taxes taken away every paycheck, understood. But once I put through the NYC W-2, my federal returns falls from $2,400 to 600. If I'm not mistaken, does that not mean I owe $1,800 to Federal in regards to my NYC job? I understand I had "2" but could I really owe THAT much in taxes from being there only 3.5 months?
That just seems quite farfetched. Last year, I had the same split between NJ/NYC (with one company but worked on NYC clients for 4 months) and my return seemed pretty fine and normal.

Any thoughts? Am I perhaps doing something wrong or could 3.5 months of "2" exemptions in a NYC job, reduce my federal return by $1,800?

Again, thanks anyone in advance. I appreciate any help.

Wnhough · #2 (**permalink**) 02-22-2014, 01:06 PM

Quote:

Originally Posted by DE201

#1;I live in NJ. Worked 8.5 months in NJ - after putting in around $46,000 of income, my federal return sits at around $2,400. I then put in my NYC W-2, where I got a new job and worked the other 3.5 months, earning around $21,000. Now, I mistakenly put "2" as my exemption so yes, I had less taxes taken away every paycheck, understood. But once I put through the NYC W-2, my federal returns falls from $2,400 to 600. If I'm not mistaken, does that not mean I owe $1,800 to Federal in regards to my NYC job? I understand I had "2" but could I really owe THAT much in taxes from being there only 3.5 months?
That just seems quite farfetched. Last year, I had the same split between NJ/NYC (with one company but worked on NYC clients for 4 months) and my return seemed pretty fine and normal.

#2;Any thoughts? Am I perhaps doing something wrong or could 3.5 months of "2" exemptions in a NYC job, reduce my federal return by $1,800?

Again, thanks anyone in advance. I appreciate any help.

2 withholding allowances that you mistakenly put in your nyc W2 reduces the w/h amount reported on 1040 line 61, NOT the amount reported on line 61;your total gross income for the year was $67K;$46K+$21K; the amount of your fed tax liability is the tax liability imposed on your gross income after subtracting other dedcutions/exemptions or etc and is reported on 1040 line61; the total amount w/h from your paychecks is reported on 1040 line 62; aslongas the amount in 61 > the amount in line 62, you need to pay tax to IRS.the number of Withholding allowances on nyc W2 may differ from the number of exemptions claimed on your 1040.

#2;as metioned abov.

Wnhough · #3 (**permalink**) 02-22-2014, 01:45 PM

Now, I mistakenly put "2" as my exemption so yes, I had less taxes taken away every paycheck, understood. But once I put through the NYC W-2, my federal returns falls from $2,400 to 600. If I'm not mistaken, does that not mean I owe $1,800 to Federal in regards to my NYC job? =======sorry for my misinternpretation; you are right aslongas there is no change in the amount of NJ state tax w/h from your NJ paychecks ;as the additional 2 withholding allowances on your NYC W2 decrease your w/h tax liability reported on 1040 line 62 up to the reduced NYC tax liability, it increases fed tax liability by that amount.