you’re welcome
I used a conservative estimate for my tax withholding allowances earlier this year, because I’m a contract (temp) employee and I didn’t want to chance owing the government at the end of the year since my income is somewhat unpredictable. However, I didn’t want to overpay the government, so I used the 2008 Tax Withholding Calculator to figure out how I could increase my take-home pay while avoiding giving the government too much money throughout the year.
Well, that conservative estimate was a little too conservative. It looks like I will have overpaid the government about $1,600 by the time my contract is up. It’s a good thing that I haven’t had too little withheld from my check, but on the flip side, I just lent my country - this means you - $1,600 interest free that could have been working for me in either my savings, my IRA, or my stock portfolio. See the sacrifices I make for y’all? You’re welcome. AIG, I’ll be expecting that thank-you-note any day now.
If/When I start working again after this contract is up, I will use the Withholding Calculator again to see how much of my money I can keep.
I keep a running tax estimate spreadsheet for just this reason. It allows to me to see/forecast how much I’m having withheld in relation to my estimated tax liability.
I update it whenever there’s a change in income (i.e. side income, bonus, etc.) and it allows me to know if I need to change my withholding.
Comment by GeckoGirl — September 22, 2008 @ 10:28 am
Thanks for this link - I just used a ballpark estimate as it’s my first time making quarterly payments, then underpaid last quarter because I didn’t make as much - just did the estimate and realized I’m within $20 of where I should be! I thought some of your readers might want a HYSA that does something for the planet. I work with [redacted] to promote their account with 3.50% APY - they invest the money saved with them in green lending projects. More here: [redacted].
Julie, everyone else who has been interested in advertising on this site over the past year and some odd months has asked for my permission first. I’m a little put off by advertising in my comments when I haven’t had an opportunity to screen the advertising. That said, I had to redact this information as a matter of policy. No offense to you or the product.
Comment by Julie — September 22, 2008 @ 6:28 pm