I got my first "big" paycheck this week. I worked 58 hrs (we are shooting for 60) in the payperiod, so this was a good indication of what this paycheck will look like. I liked it!
However, I am going to have to adjust the tax withholdings. While getting a nice fat paycheck every other week would be SWEET, I know that the taxes will come back to bite us in the behind come next year. In particular, our state taxes. I don't get our state taxes. We keep increasing the withholding, and we STILL owe every year.
I am terrible at figuring out the withholdings. My plan is to look at last year's taxes and use those as a guideline for the total amount that we need to pay to the government. I will probably just override the the withholdings and just say "take out X dollars," which is what I do now. Of course, when I did my withholdings originally, my paychecks were alot smaller.
I am really hoping to not owe anything. I can live without getting a refund....I just don't want to owe.
So now I have a choice.....I can change the withholdings officially, and
never see that money. OR....I can transfer it into a holding account
for next year, and if (when) we owe, then we have it there. If I transfer what would have gone to the government into another account....I will earn a little interest (albeit, only a few dollars).
Of course, we are already half way through the year, so I may need to take out "extra" for the next few months to make up for any deficit that wasn't withheld in the past months, as I started working more. Actually, I just realized I changed my withholdings in January, and my boss never made the changes in the computer!! So I am already a little behind (not by alot....but a little).