choosing correct Filling

[Edgar Ivan]

Hi,

I would like to ask which option best fit to my current situation, I'm married  and i have a son, since im the only one that will be working since my wife has not allowance.

how should claimed to be taxed as best fit?

I live in Wisconsin.

Thank you on advance

[xmasbaby0]

JOINT vs. SEPARATE RETURNS

If you were legally married at the end of 2024 your filing choices are married filing jointly or married filing separately.

Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will get the married filing jointly standard deduction of $29,200 (+ $1550 for each spouse 65 or older)  for 2024. You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit. 

If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return.

 Some of the special rules for filing separately include: you cannot get earned income credit, education credits, adoption credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable. Your limit for SALT (state and local taxes and sales tax) will be only $5000 per spouse. In many cases you will not be able to take the child and dependent care credit. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI)

 If  you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice since with online, you get one return per fee.

https://turbotax.intuit.com/tax-tips/marriage/should-you-and-your-spouse-file-taxes-jointly-or-separ...

https://ttlc.intuit.com/turbotax-support/en-us/help-article/income/getting-married-mean-taxes/L2Rgma...

https://ttlc.intuit.com/turbotax-support/en-us/help-article/taxation/married-filing-separately-commu...

[Edgar Ivan]

thank you, 

adding more details, in my personal situation i just moved to the US, i have been married to my spouse for about 4 years, my son is 2 years old. i was told best option might be to claim Married Filing Jointly has wider tax brackets, because I'm  taxed at a lower effective rate. The rate would be 22% up to $190,750,  I think that my best option would be to claim married filing zero.  

[xmasbaby0]

@Edgar Ivan  Are you asking what to do on your tax return (the Form 1040 you send to the IRS to receive a refund or pay tax due) -----or are you asking how to fill out the W-4 you give to your employer to tell them how much tax to withhold from your paychecks?

https://turbotax.intuit.com/tax-tools/calculators/w4/ 

https://www.irs.gov/individuals/tax-withholding-estimator

https://www.irs.gov/pub/irs-pdf/fw4.pdf

[Edgar Ivan]

 I'm asking how to fill out the W-4 you give to your employer to tell them how much tax to withhold from your paychecks, due to I'm just getting started to know how it works here and how should be selected better for my current situation background.

[AmyC]

You want to be sure to have enough taxes withheld that you owe less than $1,000 to the federal to avoid penalties and interest. Some people like to zero out at tax time and some people like to give the government their money and then get one big refund at tax time. If you are good at saving money, a big refund is not desirable as you can save through the year and earn more. If you are terrible at saving, a big refund can be nice. Let's start with the basics. The more allowances you claim, the less money they take out. Married with one dependent  is normal for your situation.  By saving the money, you may even qualify for  the Saver's Credit. Here are some options and examples:

Federal

Method 1

Use the Tax bracket calculator to find out what percent should be withheld to zero out. Ex, Marginal tax rate 10%

1. Grab your paycheck.
2. Find your federal tax withheld and divide it by income.
3. Ex. $500/ $5000 = 10% on track to zero out. 
4. Ex. $500/10,000 = 5% is less than 10% so you will owe money.
5. Ex. $500/ $4000 = 12.5% is greater than 10% so refund time.

Method 2

1. Determine how much your tax liability will be for the federal with TaxCaster tax calculator. Let's pretend it's $1,000.
2. Decide if you want a big refund, let's say you want $3,000 refund
3. Add them together so $4,000 would need to be withheld from your paychecks to get the refund desired.
4. Figure out how many pay periods are left in the year.
5. Grab a paycheck and see how much they .have already taken. Let's say $500. That means you need $3500 more withheld during the year. 
6. Divide the amount needed by pay periods. Let's say $3500 and paid once a month so 8 checks left is $438/ mo to take out.
7. Subtract what they are currently taking out and you get how much more needs to come out of your paycheck. 
8. Go to HR, tell them you need to change your w4.Keep whatever you filled in for exemptions originally. There is a box that says take an additional $___. Fill in that difference.

Method 3

Similar to method 2, using IRS calculator, Tax Withholding Estimator

Wi has a graduated tax rate based on your income. You can see the DOR Tax Rates - Wisconsin Department of Revenue  and use the WI withholding calculator employers use to help you determine how you want to file your WI w4.