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US Year 2019 Tax Sample

Obligatory photo of shop kittie inspecting transformers while I try to get work done.

Some taxes, such as Sales Tax and State Unemployment Tax were not included. They might be added later. If you were to live in Texas, there would not be a State Income tax; if you lived in Alaska the State would pay you instead of you paying State Income Tax; if you were living in California or New York, the State Income Tax might be a bit higher (8-9%).

IRS Publication 15 can be downloaded from https://www.irs.gov/pub/irs-pdf/p15.pdf

US Income Taxes for year 2019

Example cases comparing taxes on general laborer wages and engineering wages
Married
$36,000 / year
$3,000/month
Married
$200,000/year
$16,667/month

Comes out of your payroll and is shown on your pay stub

Federal Income Tax – $0->$983 (see note below) 0%  –  –
Federal Income Tax – $983->$2,600 (10%) 10%  $161.70  $161.70
Federal Income Tax – $2,600->$7,563 (12%) 12%  $209.70  $595.56
Federal Income Tax – $7,563->$15,017 (22%) 22%  –  $1,639.88
Federal Income Tax – $15,017->$27,771 (24%) 24%  –  $2,035.88
Federal Income Tax – $27,771-.$35,000 (32%) 32%  –  –
Federal Income Tax – $35,000->$52,013 (35%) 35%  –  –
Federal Income Tax – $52,013 and up (37%) 37%  –  –
Indiana State Income Tax (3.23%) 3.23%  $96.90  $538.34
Federal Insurance Contributions Act (FICA) on paystub 6.20%  $186.00  $1,033.35
MEDICARE Tax on paystub 1.45%  $43.50  $241.67
Additional Medicare Tax on paystub 0.90%  –  $150.00
Total taxes you are told about on your pay stub  $697.80  $6,396.39
Amount you were told you would be paid  $3,000.00  $16,667.00
Amount you were really paid  $2,302.20  $10,270.61
Percent of promised amount you were really paid 76.74% 61.62%

Comes out of your payroll money without your knowing

Federal Unemployment Tax 6%  $180.00  $1,000.02
Federal Insurance Contributions Act (FICA) (yes, again) 6.20%  $186.00  $1,033.35
MEDICARE Tax (yes, again) 1.45%  $43.50  $241.67
Total Taxes You were not told about  $409.50  $2,275.05
Amount you would have been paid without the hidden taxes  $2,711.70  $12,545.65
NOTES: Federal Income Tax is charged based upon how much money is made, not a flat percentage for everyone. Those who earn more money pay ever increasing percentages as Federal Income Tax. The brackets shown here are from Pub 15, page 46, Table 4 MONTHLY Payroll Period.

IRS issues notice on state and local tax deductions

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WASHINGTON — The U.S. Department of the Treasury and the Internal Revenue Service issued a notice today stating that proposed regulations will be issued addressing the deductibility of state and local tax payments for federal income tax purposes. Notice 2018-54 also informs taxpayers that federal law controls the characterization of the payments for federal income tax purposes regardless of the characterization of the payments under state law.

The Tax Cuts and Jobs Act (TCJA) limited the amount of state and local taxes an individual can deduct in a calendar year to $10,000. In response to this new limitation, some state legislatures have adopted or are considering legislative proposals allowing taxpayers to make payments to specified entities in exchange for a tax credit against state and local taxes owed.

The upcoming proposed regulations, to be issued in the near future, will help taxpayers understand the relationship between federal charitable contribution deductions and the new statutory limitation on the deduction of state and local taxes.

Taxpayers should also be aware the U.S. Department of the Treasury and the Internal Revenue Service are continuing to monitor other legislative proposals being considered to ensure that federal law controls the characterization of deductions for federal income tax filings.

The limitation imposed by the TCJA applies to taxable years beginning after Dec. 31, 2017 and before Jan. 1, 2026.

Updates on the implementation of the TCJA can be found on the Tax Reform page of IRS.gov.


The Cold is to be Expected

tnt-bomb-gualtiero-boffi-300x300First the Federal Government banned the incandescent light bulb on the dubious excuse that it used too much energy. Now they are banning coal as a fuel to generate electricity. What with all this massive corrections to prevent Global Warming it was to be expected that we would have the coldest, iciest winter in a century.

Back Off Guys! You’ve “saved” us enough already!