Hi everyone, I’m a bit confused here. I didn’t make any changes to my withholdings. I’m married filing jointly with no exemptions. Last year, I earned around $98k and about $10k was taken out for federal taxes. This year, I made the same amount, but only $5,500 was withheld. How is this even possible? It’s the end of the year, and now I’m worried I might owe a lot. Can someone explain what’s going on? Thanks in advance!
This sounds like something to bring up with your HR or payroll team. They can help you check if your W-4 is set up correctly. A lot of people notice issues like this too late. Next year, keep an eye on your paystubs regularly so you can catch any problems earlier.
Something must have changed. Maybe you switched to the newer W-4 form, or your employer updated their payroll system. It could even be because of bonuses or overtime. Check with HR to confirm.
Not gonna lie, I thought you meant your tax ID number changed or something. But yeah, this sounds like a withholding issue.
Lane said:
Not gonna lie, I thought you meant your tax ID number changed or something. But yeah, this sounds like a withholding issue.
Same here! I was like, wait, did their EIN get swapped or something?
Lane said:
Not gonna lie, I thought you meant your tax ID number changed or something. But yeah, this sounds like a withholding issue.
The only change I made was increasing my 401k contributions by 2%. Nothing else was updated on my W-4.
@Tonny
So you didn’t notice your paychecks were higher this year? Seems like you missed that detail.
Charlie said:
@Tonny
So you didn’t notice your paychecks were higher this year? Seems like you missed that detail.
I work overtime regularly, so my paychecks fluctuate. A small difference isn’t noticeable to me.
Compare your paystubs from last year to this year. If your take-home pay wasn’t higher by $5,500, then something else might have changed, like your W-4 or deductions.
Avery said:
Compare your paystubs from last year to this year. If your take-home pay wasn’t higher by $5,500, then something else might have changed, like your W-4 or deductions.
My 401k contributions went up by $2,500 this year.
@Tonny
That could explain part of it. Check your W-4 as well. If you want to avoid this next year, calculate your tax liability for 2024 after filing and adjust your withholding to match that.
I work anywhere from 48-80 hours a week as an EMT, so my paychecks are never the same. A small difference in taxes withheld wouldn’t stand out to me.
Yeah, you’re probably going to owe. I had $10k taken out on $80k last year. This is why it’s important to review your pay stubs regularly.
Maybe someone in payroll messed up, or Brenda from accounting ‘borrowed’ a little extra from everyone this year. Who knows?
Sam said:
Maybe someone in payroll messed up, or Brenda from accounting ‘borrowed’ a little extra from everyone this year. Who knows?
Leave Brenda out of this! She retired and deserves to enjoy her hats or whatever she’s into.
Sam said:
Maybe someone in payroll messed up, or Brenda from accounting ‘borrowed’ a little extra from everyone this year. Who knows?
I’m the ‘Brenda’ in this scenario. But my name’s not Brenda.
Check your W-4. It sounds like something changed there. You might be under-withheld and could owe taxes in April. Compare your paychecks closely to see if they were higher than usual.
Jai said:
Check your W-4. It sounds like something changed there. You might be under-withheld and could owe taxes in April. Compare your paychecks closely to see if they were higher than usual.
That’s not necessarily true. OP’s taxable income would factor in deductions like 401k contributions. They might not be as far off as you’re suggesting.