How does the federal government determine how much taxes are taken out of each check?

Question

My husband works different hours every week so the federal taxes are different every week. I tried to determine the percentage of how much they take out but each week it is different. Not consistent at all. How do they determine how much to take out.

Answer 1

They issue a withholding chart for employers. Look it up in the gov. publications under withholding.

Answer 2

It is not a flat percentage.

We have a progressive tax system so, the more you make, the more they take out.

You can enter the pay information here:

www.paycheckcity.com

The withholding calculator is very accurate.

Answer 3

It depends on how much he makes that pay period, and what he has on his W-4, for federal income tax.  There's a chart showing how it's calculated in Publication 15, Circular E, page 38 - you can download it at irs.gov if you want to look at it.

Basically they subtract an amount from what he made for each allowance on his W-4, then follow a table to determine how much tax to take, so if he made that same amount every pay period he'd have the correct tax withheld for the year.

Answer 4

It is not the government doing this, but his employer.  If someone makes $1K in a week, the employer's software assumes he will make $52K in a year (1x52).  If he makes only 500 the next week, the software assumes he will only make $26K in a year, and lowers the tax rate.

I deal with this as a salesperson, as I will make $500 one week, and $10K the next, and my taxes vary widely.  The good thing is, they even out at the end of the year.