Pay Check Exemption/Allowance? Federal: 0, Tax Blocked?

Question

I have a question, at my part time job I've noticed there are not a lot of taxes taken out. I work an avg. of 15 hours every two weeks. Example:my YTD earnings are $2,600 and I've only paid $7.36 in Federal taxes. Is that low level of deductions low or odd?

The check stub summarizes my federal exemptions are being 0 - Tax Blocked. YTD state deductions $130, Medicare $40, and SS. $162. I am not really concerned with the other deductions, however; the Federal tax deductions in relation to the percentage withheld, kind of scares me.

Any advice? I believe the company is trying to limit their liability in paying their employer paid taxes.. help!! I do now want to be out - owing my least favorite uncle SAM money, plus interest!!

Answer 1

  The taxes you are having taken out are the ones the employer pays part of and income tax is nothing from them.  You are earning very little money and if you calculate it out to get the year (I would estimate it but you didn't say when you started) you are probably going to be below the level where you pay ANY income tax  (take the total, subtract  standard deduction and exemption and look in the table)

Answer 2

Your income is so low that you won't have any Federal income tax liability if your income remains steady for the rest of the year.  Your withholding is correct for your income.

Answer 3

Quit thinking the company is trying to get out of something.  The ones THEY match are ss and medicare, and those sound right.  Your company doesn't pay in anything toward your income tax, just forwards what's withheld.  The reason the federal withholding is so low is because you have made so little that you won't owe taxes unless you make a lot more in the rest of the year than you have so far.

Answer 4

Based on your narrative, your federal tax liability will be zero.  There is no benefit to the company to under-withhold from you because it has to pay that over to IRS anyway.  

Answer 5

Go to Payroll Department and ask them to make federal income deduction, and  ask in writing  for a reason the deduction wasn't made., so you will have it on file when the IRS asks for their money.