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Explain US (California) taxes please!

Explain US (California) taxes please!

Old Feb 6th 2011, 1:45 pm
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Default Explain US (California) taxes please!

My first post!!

I'm trying to figure out how much tax will be deducted from my husband's gross pay (ie what will our net income be?) in the state of California

I've googled and found some online calculators but as far as I can tell there will be 3 main deductions from the gross pay. 1.federal tax 2.state tax 3. medicare. but there are credits we can claim and I'm not sure how these work ( we've 3 kids)

So my question - what would be the ESTIMATED % deductions to gross pay based on 3 kids, wife not working and no property taxes (at first we will rent)

I'm trying to do an early budget on our move - I work here but will not in the US so I need to see how that will effect our household income!!

Many thanks in advance
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Old Feb 6th 2011, 2:54 pm
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Default Re: Explain US (California) taxes please!

Originally Posted by MillyBean
So my question - what would be the ESTIMATED % deductions to gross pay based on 3 kids, wife not working and no property taxes (at first we will rent)
Generally speaking, expect to take home 65% of your gross pay - with only minor variations, this is true pretty much across the entire US. It will certainly serve your "early budget" situation.

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Old Feb 6th 2011, 2:59 pm
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Default Re: Explain US (California) taxes please!

Thanks Ian
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Old Feb 6th 2011, 3:22 pm
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Default Re: Explain US (California) taxes please!

Originally Posted by MillyBean
My first post!!
I've googled and found some online calculators but as far as I can tell there will be 3 main deductions from the gross pay. 1.federal tax 2.state tax 3. medicare. but there are credits we can claim and I'm not sure how these work ( we've 3 kids)
The form W-4 comes with a worksheet that should allow you to work out the credits you can claim.
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Old Feb 6th 2011, 4:12 pm
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Default Re: Explain US (California) taxes please!

Originally Posted by TimNiceBut
The form W-4 comes with a worksheet that should allow you to work out the credits you can claim.
Yes, but at this stage the W4 will probably just leave the OP even more confused than they are now (after almost 25 years here I know that is certainly still confuses me ...)

Last edited by md95065; Feb 6th 2011 at 4:29 pm.
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Old Feb 6th 2011, 4:43 pm
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Default Re: Explain US (California) taxes please!

I live in CA and have zero deductions (no kids, no mortgage) and find my take-home kicks around the 63-65% (before health ins, 401k deductions etc)
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Old Feb 6th 2011, 9:45 pm
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Default Re: Explain US (California) taxes please!

Hi

I've come across the w-4 form on my searches before.

I am just looking for a guide on % take home pay and I guessed the kids would impact my husbands taxes/credits but couldn't figure the credits out.

many thanks for taking the time to reply it gives me a rough idea what to expect.
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Old Feb 6th 2011, 11:50 pm
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Default Re: Explain US (California) taxes please!

Also figure out what will be taken out pre tax for 401K pension and contribution towards medical insurance.

Also depending on the state and where in the state, there might be county or city taxes too.
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Old Feb 7th 2011, 1:20 am
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Default Re: Explain US (California) taxes please!

I pay 6% 401K and 290 a month pre tax medical insurance. I plan to flie married joint (wife does not work). That being said I am taking 68% of gross, home AFTER the 401k and medical insurance.
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Old Feb 7th 2011, 2:47 am
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Default Re: Explain US (California) taxes please!

It's worth mentioning some terms of art here which may help you in your Google searches for more information:

Tax "deduction" is an amount that reduces your overall taxable income.
Tax "credit" is a dollar-for-dollar reduction in the amount of tax you owe.

Children are generally a "deduction" and not a tax credit. You can get a credit for certain expenses (including some child care if you meet some requirements) but generally dependents like kids are deductions.

Here's a list of some of the more popular ones:

http://taxes.about.com/od/deductions...ns_Credits.htm
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Old Feb 7th 2011, 7:46 pm
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Default Re: Explain US (California) taxes please!

Bob - city and county taxes how many taxes are there to pay??

E3only - thanks for that info - hadn't realised the med ins was so much per month I will calculate on 68% as we will be in a simliar situation - me not working. any other deductions (thanks penguinsix) for the kids will be a bonus on the take home pay

thanks everyone for the info
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Old Feb 7th 2011, 7:51 pm
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Default Re: Explain US (California) taxes please!

Originally Posted by MillyBean
Bob - city and county taxes how many taxes are there to pay??

E3only - thanks for that info - hadn't realised the med ins was so much per month I will calculate on 68% as we will be in a simliar situation - me not working. any other deductions (thanks penguinsix) for the kids will be a bonus on the take home pay

thanks everyone for the info
If you buy your own home property taxes are pretty hefty depending on where you live.
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Old Feb 7th 2011, 8:04 pm
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Default Re: Explain US (California) taxes please!

Originally Posted by MillyBean
Bob - city and county taxes how many taxes are there to pay??

E3only - thanks for that info - hadn't realised the med ins was so much per month I will calculate on 68% as we will be in a simliar situation - me not working. any other deductions (thanks penguinsix) for the kids will be a bonus on the take home pay

thanks everyone for the info
I don't know of any city or county in California that imposes an income tax. Usually the only tax imposed on the local level in California is property taxes (paid by the owner and not the renter) and possibly sales tax (8.25% by the state of California and up to 2% by local governments but no sales tax on food and some other items).
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Old Feb 7th 2011, 8:20 pm
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Default Re: Explain US (California) taxes please!

Originally Posted by Michael
I don't know of any city or county in California that imposes an income tax. Usually the only tax imposed on the local level in California is property taxes (paid by the owner and not the renter) and possibly sales tax (8.25% by the state of California and up to 2% by local governments but no sales tax on food and some other items).
Bills such as phone bills are loaded with taxes and fees...or at least they are in NJ. The monthly bill is nothing like what the provider quotes you.
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Old Feb 7th 2011, 8:25 pm
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Default Re: Explain US (California) taxes please!

That is what the HR department is for, honestly, it is. I often had to ask them to give me the calculations of what my take home pay would be after taxes and X amount of contributions to my 401K and Flex Spending Plan.

I did this so that I could determine where the tax break comes in for the 401K contribution. In some cases if you increase by $100 a paycheck you might well come home with more spendable money then if the contribution were $100 less.
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