Tax Increase?

Civil Service Discussion.

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ewok55
Posts: 77
Joined: Sun Jan 08, 2017 5:39 pm

Re: Tax Increase?

Post by ewok55 »

evilanne wrote:OASDI $ Amount should be divided by [Gross minus (FEHB & FSA/HSA)]. You pay SS taxes on the amount that you put in TSP. For Traditional TSP the difference in-between Block 1 & 3 on your W-2 is typically your tax deferred contributions (Code D in Block 12).
I obtained the percentages listed in the OP by dividing the amount withheld by my "Taxable Wages."
Tomanyiron wrote: :shock: We should've went to G before lunch, (yesterday). :cry:


Current:
#20931

Past:
18.88% - 2017 (GClapper's Mix)
11.44% - 2016 (L2040)
0.89% - 2015 (L2040)
6.59% - 2014 (L2040)

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evilanne
Posts: 2067
Joined: Thu May 14, 2015 6:52 pm

Re: Tax Increase?

Post by evilanne »

Taxable wages excludes TSP contributions resulting in a lower denominator & higher percentage. What happens if you divide by (taxable wages + TSP contribution)?

User avatar
MakeMe$$$$
Posts: 772
Joined: Tue Aug 23, 2011 10:12 pm

Re: Tax Increase?

Post by MakeMe$$$$ »

This might be a bit of a tangent to the OP's point but a word of caution.

My wife and I just reviewed our pension payments (me Fed, Sandee State of IL) for February. The withholdings for both pensions have been lowered.

At one point during the Bush tax cuts the tax withholding tables were apparently adjusted to further increase take home pay. The problem was that the withholdings were reduced too much for many tax payers. The problem was that this caused many tax payers to be charged a penalty for the under withholding.

In the past I could rely on the tax planner in my Quicken for Windows to keep an eye on my expected tax bill. Since I recently had to convert to Quicken for Mac I've lost that feature. SIGH!

I haven't seen any data that says the current withholding tables are skewed in the same way. I'm only regurgitating something one pundit mentioned as a tactic the administration might use to "sell" the tax plan after implementing it. Just something to keep an eye on.
Don
Rolled over to Fidelity 2/24/18.
Fantasy still playing with Daily Strategy 12767.

User avatar
ewok55
Posts: 77
Joined: Sun Jan 08, 2017 5:39 pm

Re: Tax Increase?

Post by ewok55 »

evilanne wrote:Taxable wages excludes TSP contributions resulting in a lower denominator & higher percentage. What happens if you divide by (taxable wages + TSP contribution)?
Ran the figures as you recommended. The increase in taxes went away for Medicare/SSI, but is still there for State/Federal Tax withholding. Somebody above mentioned that the withholding amounts won't be adjusted until February 1st, so I think that answers my question. Thanks all; will be keeping an eye on it!

New Figures:
2017 Withholding / 2018 Withholding
3.67% / 3.74% - State Tax withholding
1.45% / 1.45% - Medicare withholding
6.20% / 6.20% - Social Security withholding
10.32% / 10.52% - Federal Tax withholding
Tomanyiron wrote: :shock: We should've went to G before lunch, (yesterday). :cry:


Current:
#20931

Past:
18.88% - 2017 (GClapper's Mix)
11.44% - 2016 (L2040)
0.89% - 2015 (L2040)
6.59% - 2014 (L2040)

PoorFed
Posts: 43
Joined: Sat Oct 08, 2016 8:27 pm

Re: Tax Increase?

Post by PoorFed »

ewok55 wrote:Anybody else see a tax rate INCREASE (regarding withholding amounts) on their first paycheck of 2018? Politics aside, I was expecting a decrease based on everything I had seen in the news. I will be meeting with my CPA next week but thought I'd see if anybody else had made similar observations...

2017 Withholding / 2018 Withholding
1.45% / 1.53% - Medicare
3.88% / 3.94% - State Taxes
6.2% / 6.53% - Social Security
10.95% / 11.07% - Federal Taxes
22.48% / 23.07% -Total
I noticed that DFAS withheld more federal taxes than what I anticipated. For my situation, everything else checked out fine from SS, Medicare, and state taxes. However, I cannot figure out why they withheld more federal taxes from my paycheck. I was going to wait it out for a few pay periods to see if that trend continues since the next several paychecks are paying out my comp time earned so it may be skewing the numbers but I swear I have that factored into my spreadsheet and it worked perfectly fine for 2017. Not too concerned since the federal taxes they are taking out will eventually go towards my tax liability but I’m the type that aims for $0 at the end of the year meaning that my withholdings made it so I didn’t give Uncle Sam a free loan and I don’t owe either.

User avatar
cswift01
Posts: 819
Joined: Thu Dec 08, 2016 10:46 am

Re: Tax Increase?

Post by cswift01 »

ewok55 wrote:
evilanne wrote:Taxable wages excludes TSP contributions resulting in a lower denominator & higher percentage. What happens if you divide by (taxable wages + TSP contribution)?
Ran the figures as you recommended. The increase in taxes went away for Medicare/SSI, but is still there for State/Federal Tax withholding. Somebody above mentioned that the withholding amounts won't be adjusted until February 1st, so I think that answers my question. Thanks all; will be keeping an eye on it!

New Figures:
2017 Withholding / 2018 Withholding
3.67% / 3.74% - State Tax withholding
1.45% / 1.45% - Medicare withholding
6.20% / 6.20% - Social Security withholding
10.32% / 10.52% - Federal Tax withholding
It might also depend on which state you work/reside. Remember that SALT is not deductible anymore...or after the 1st of February. :roll:

Carmen909
Posts: 109
Joined: Sun Dec 04, 2016 12:16 am

Re: Tax Increase?

Post by Carmen909 »

I think that the amount of pay periods you have makes a difference in how much your annual pay is calculated and therefore how taxes are calculated. 27 pay periods means your annual income is actually higher this year than last year. So maybe that's reflected in your paycheck. Just a guess.

User avatar
twarr3
Posts: 9
Joined: Wed Aug 17, 2011 9:33 pm

Re: Tax Increase?

Post by twarr3 »

The new tax rate won’t be in your pay until mid February. That’s when you will see a difference.

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