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I currently believe if you can correctly fill out a 1040, sch1, 2 Sch A, 8995, Sch C,4562, Sch D,Sch E ,8283, 8824, etc. You are qualified to sit on the supreme court.
what kind of employer would withhold FICA and Medicare without withholding Federal Income tax??
While it could be a gross mistake on the employer's part, an employee can also claim to be exempt from withholding.
See page 2 of https://www.irs.gov/pub/irs-pdf/fw4.pdf where it says:
"To claim exemption from withholding, certify that you meet both of the conditions above by writing “Exempt” on Form W-4 in the space below Step 4(c)."
So unless the employer can quickly issue a revised W-2, the OP may in for one huge tax bill
While it could be a gross mistake on the employer's part, an employee can also claim to be exempt from withholding.
See page 2 of https://www.irs.gov/pub/irs-pdf/fw4.pdf where it says:
"To claim exemption from withholding, certify that you meet both of the conditions above by writing “Exempt” on Form W-4 in the space below Step 4(c)."
So unless the employer can quickly issue a revised W-2, the OP may in for one huge tax bill
Correct. But, if I understood correctly, the OP isn't a W-2 employee, they're a consultant. The client company is expecting the consultant to set up their own withholding. Maybe they still retain the option to take out SS and Medicare taxes for a consultant...don't know, I've never been one.
I hope you did arrange withholding for yourself OP. If you didn't, that's going to be one horrible lesson learned. Your income tax liability could be !
Last edited by Parnassia; 04-10-2022 at 03:16 PM..
I recall back in the 1980s I worked in a large corporation,one of my colleagues claimed he does not believe in paying taxes and so his paycheck is void of Fed INCOME tax(there is no state income tax) but it finally caught up with him.
But it looks like even in a large billion dollar corporation,one could get away from withholding income tax,the corporate payroll dept did not withhold any of his income tax.
https://itfp.com/federal-income-tax-tables-2021/
It looks like she would have a 5 figures tax bill,based on her gross income of $115,472 less standard deduction of $12,500,less charitable contribution($500 max if it were cash),could be no more than $25K
I dont understand this medicare deduction>
If she is over 65,then the medicare premium should come out of her SS check??
IIRC, the OP hasn't stated anything about being over 65 and nothing about receiving Medicare or SS. You should know most employers must withhold some percentage of employee wages for both. That doesn't mean the employee is receiving either of them. The OP has already stated that this employer (client company????) seems to have withheld something, but needs to clarify what. Are they actually a W-2 employee or a contractor who was supposed to pay FICA, SS and Medicare taxes for themselves?
OP has told us her employer has withheld $1647.35 medicare and $7159.27 SS,her gross income is $115,472,she is born after Jan 2,1957 which says she is less than 65 years old(.
also if no tax is withheld in 2021,and it turns out she owes tax,is there a penalty for not making estimated tax payment for 2021?
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IIRC, the OP hasn't stated anything about being over 65 and nothing about receiving Medicare or SS. You should know most employers must withhold some percentage of employee wages for both. That doesn't mean the employee is receiving either of them. The OP has already stated that this employer (client company????) seems to have withheld something, but needs to clarify what. Are they actually a W-2 employee or a contractor who was supposed to pay FICA, SS and Medicare taxes for themselves?
