re: First time ever I owe taxes

quote:

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also just checked mine and im filing joint married with 0

also it has a N next to my wife doesn't work and it should be Y. Will that make a difference?

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Now we are cooking with gas.

If you withhold married joint, it assumes that only one spouse works.

But both of you are working. So your income gets combined together, and because of our marginal rates, you have an issue.

Let's assume you are in the 24% marginal tax bracket just on your income. Well, the withholding tables assume that some of your income is taxed at 0% (due to standard deduction), some at 10%, some at 12%, some at 22%, and the rest at 24%.

Now, let's add your wife's income to the stack. You have already used up the 0, 10, 12, 22, and part of the 24% "buckets" just for you. So your wife's first dollar of income earned is taxed at 24%, and goes from there.

However, she is likely being withheld at something well less, because her income is so much less than yours.

The easy fix here is to set both of you as single, 0 exemmptions, which will max withhold, and see if that solves the problem.

The slightly harder fix is to use a withholding estimator, like the ones on the IRS website, and make some granular adjustments to your withholding.

LINK

You may want to do this soon, so you can fix any problems for 2024 before they get worse.

Also... if one or both of you get a lot of your income in the form of bonuses, incentivre comp, etc, understand that the withholding tables don't handle that well, and you may need to start making some estimated payments as well.