Good Morning Gentle Readers,
IRS offers a sophisticated online program to help you figure out the correct withholding for 2005.
Uncle Big says that......
most people will find it more accurate and easier to use than the worksheets that accompany Form W-4.
Well, DUH. Since nobody can figure out how to make the W-4 form and instructions work I guess that makes sense.
Caution: You still need to have some basic understanding of how taxes work to effectively use the calculator.
Caution: You may come up with something other than what we have advised you to claim on your W-4. That's cool, but you are going to have to make the final decision on which way to go.
And one more caution: Some states, notably Californicate, still have problems reconciling W-4 status for state purposes with W-4 status for federal purposes.
In English that means that what you claim on your W-4 for IRS withholding may not work for state income tax withholding. When there is a problem, the typical taxpayer ends up with a refund from IRS and owes state income taxes.
If you want to cut right to the chase and skip the intro click here.