How will my wife's job affect our taxes?

[tlsa98]

My wife hasn't worked in 20 years, now she took a part time job at a grocery store, how will that affect my taxes? I make around 100k/yr. We have 2 kids at home. She will make perhaps 10k this year.

[SweetieJean]

Is she a W2 employee, or a 1099-MISC independent contractor?

[tlsa98]

W2

[Hal_Al]

As a W-2 employee she will NOT be subject to self employment tax, in  addition to income tax, like a  1099-MISC independent contractor would be.

[Hal_Al]

It’s complicated.

Her income is added to you income to determine your tax rate; so you could be pushed into a higher tax bracket. The additional income could reduce you Earned Income Credit (EIC).

The only say to be sure is to prepare mock returns. That’s not easy with the online software, but this tool will work. https://turbotax.intuit.com/tax-tools/calculators/taxcaster/?s=1. Enter your income first to see the regular tax. Then add her income to see the effect.