Right now I claim 1 federally (0 for the state), and have my taxes computed as SINGLE. I'm getting married in July and I wasn't sure if I should I change my withholding now to increase my paycheck.
If I change the withholding, I'll be able to use that money to cover wedding expenses... or to set aside extra money for when we "take a paycut" when we are married (I won't be able to have cafe cash when we get hitched... because well be using it for his health insurance.)
If I don't and I keep trying to do what I am doing now, we'll get some money back when we do our taxes next year, and that could come in handy to pump up the emergency fund or replenish it without having to save up a little each month...
hmmmmm
Thoughts? I'm really torn on this idea. When we get married, I'll be loosing the $164 a check cafe cash, and will instead have around $57 deducted from each paycheck... even with the married tax brackets and claiming 2, we'll definently be loosing money from each check... and well have increased costs (more groceries, insurance, gasoline, etc)... and it may take a while for Keith to be able to find a Job in California. That "tax refund" may come in handy to help replenish a lot of things.... but on the same terms, I'd like to pay for the wedding without robbing my emergency fund...
It's best to "loan" the government as little of your money as possible since they don't pay interest. :) It's tempting to try for a larger refund but it's not good finances. It's better to get as much of your money each check as you can, without having to pay at tax time. That would mean changing your withholdings now. If you go to the IRS website, there's a Withholding Calculator you can enter your information into and it will give you a recommendation on how to do your W-4.
ReplyDeletebad idea...you don't know what your future dh will make nor pay in taxes this year. In addition, when you get married you may still be hit with the "marriage penalty" as that act was not extended as part of the recent tax act signed in dec 2010. Leave it until after the wedding.
ReplyDeleteLook into how much your taxes will be once you get married. Friends of mine were surprised in a bad way and had to rob savings to pay CA and fed tax after they got married. And I believe that they had even kept witholding S and either 1 or 0 for each of them.
ReplyDeleteI'd do the math on the irs.gov site and see what it says :)
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