W-4 exemptions

[DTS]

Is there a formula for doing a quick calculation in my head for exemptions claimed? If so, can you share it w/me?

Seems I was told years ago that for every exemption claimed, $7 per $100 or $110 earned was not withheld.

Thank you,

D

[S T]

Cfs

CFS (Tax Tools) has a W-4 calculator http://www.taxtools.com/

I haven't used it, but I did find an online calculator http://www.qcktax.com/w4-calculator.php

In both cases it would appear that you need the clients most current pay stub, and some other income and itemized deductions.

Note: I have found in the past that what I compute for a Federal Withholding does not always compute for the State Withholding.

Sandy

[OtisMozzetti]

Look in Publ. 15A, Percentage Method for W/H Computation

You're still going to get only a rough rule of thumb, but look in IRS Publication #15A, under "[Rate Formulas] Tables for Percentage Method Withholding Computation".
Alternative B


For example, I see the following (using 2006 numbers!):

Married person, biweekly pay period:

Subtract $126.92 for each exemption claimed

if wage above allowance is subtract this amount amount to withhold
$0 but not over $308 0 0
$308 but not over $881 $308 10%
$881 but not over $2617 $881 15%
$2617 but not over $4881 $2617 25%
$4881 but not over $7517 $4881 28%
$7517 but not over $13213 $7517 33%
over $13213 $13213 35%


Notice that the percentage rates are 0%, 10%, 15%, 25%, 28%, 33%, and 35% just like a real tax rate schedule.

[DTS]

W-4

Sandy and Otis,

Thank you both!

D