Re: Understanding Taxes, 401 etc
In the UK employer benefits are all quite simlar between different companies. In the US there can be many differences in the type of pension, vacation, healthcare etc.
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Re: Understanding Taxes, 401 etc
Originally Posted by sir_eccles
(Post 11968362)
Think of a 401k more like a shares ISA.
It's also important to point out that while 401k contributions are tax-free, US income tax is potentially due on payments out of a 401k. The value of a 401k is usually from having a lower average tax rate in retirement than during working life. That said, the tax situation would be different for a non-US taxpayer with a 401k, assuming you return to the UK. And Mrken, I see those "three types of 401k" as just being subtle variations in how the company match works. They are still overall pretty similar. |
Re: Understanding Taxes, 401 etc
Thanks all. My partner would be staying in the UK, although we do have a wedding planned for Sept 2018.
At this stage I'm not sure if I'll be permanently relocated to the US, or if it's a case of travelling between the US and UK. |
Re: Understanding Taxes, 401 etc
Originally Posted by RandomlySet
(Post 11968131)
Afternoon all.....
I'm currently in talks with a UK based company about a job which would see me relocate to NYC for their new offices there. Now whilst I love America, particularly NYC, and would like to think I'm familiar with culture over there etc, what I'm still trying to figure out is actual "living". Now from my understanding, a 401k is similar to a pension here in the UK. I also believe you have to do your own taxes at the end of the year (rather than having PAYE like we do in the UK). Oh, and then there's health cover etc etc What else do I need to consider? How much are taxes? What is a good 401k? Any help, or links would be great (Google gives me links that aren't as useful as I'd like - either that or I'm using bad search terms). You can get a good idea on taxes by using this calculator: Yearly Federal Tax Calculator 2016/2017 | 2016 Tax Refund Calculator |
Re: Understanding Taxes, 401 etc
Thanks.... Another question, can you pay your taxes monthly? I have always had the belief that you pay it annually.
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Re: Understanding Taxes, 401 etc
Originally Posted by RandomlySet
(Post 11969684)
Thanks.... Another question, can you pay your taxes monthly? I have always had the belief that you pay it annually.
Each year you must file a tax return and you will either get a refund or pay more as the tax withheld is never exact. |
Re: Understanding Taxes, 401 etc
Don't forget the likely need for state tax withholding also. The state will have their own form.
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Re: Understanding Taxes, 401 etc
Originally Posted by RandomlySet
(Post 11969684)
Thanks.... Another question, can you pay your taxes monthly? I have always had the belief that you pay it annually.
Originally Posted by Pulaski
(Post 11968239)
US tax system is like a bad attempt at PAYE - you are required to pay some taxes every time you are paid .....
Originally Posted by durham_lad
(Post 11969729)
You
The basic figure is calculated for you, and as Durham lad said, you can adjust it using a W4. |
Re: Understanding Taxes, 401 etc
Sorry, yes I did.... Think I'm trying to take too much in at once (I feel rushed lol).....
I've also downloaded that IRS form which I will have a good read through. |
Re: Understanding Taxes, 401 etc
Originally Posted by Pulaski
(Post 11969808)
FIFY :) If you don't pay tax in the periods that you earn your income, there is a penalty for late payment, though not a large penalty. But you can't under-withhold taxes all year then pay a load of tax in December without the IRS noticing.
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Re: Understanding Taxes, 401 etc
Originally Posted by RandomlySet
(Post 11969684)
Thanks.... Another question, can you pay your taxes monthly? I have always had the belief that you pay it annually.
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Re: Understanding Taxes, 401 etc
Originally Posted by Owen778
(Post 11969823)
I could be wrong, since it's been a couple of years since I had a significant capital gains tax bill, but I'm not sure that's true. There is a penalty for delaying paying estimated taxes (i.e. direct to the IRS, outside the withholding system), but I believe that you can skew your withholding towards the end of the year without penalty. Remember that your W2 form only shows total withholding, not divided up by quarter.
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Re: Understanding Taxes, 401 etc
Originally Posted by Pulaski
(Post 11969808)
The basic figure is calculated for you, and as Durham lad said, you can adjust it using a W4.
In the UK, I go to work, and then at the end of the month I get my wages into the bank, and a wage slip handed to me for reference. Sorry for being a PITA. |
Re: Understanding Taxes, 401 etc
Originally Posted by RandomlySet
(Post 11969842)
So, give me a real life example if you wouldn't mind.
In the UK, I go to work, and then at the end of the month I get my wages into the bank, and a wage slip handed to me for reference. Sorry for being a PITA. |
Re: Understanding Taxes, 401 etc
Originally Posted by RandomlySet
(Post 11969842)
So, give me a real life example if you wouldn't mind.
In the UK, I go to work, and then at the end of the month I get my wages into the bank, and a wage slip handed to me for reference. .....
Originally Posted by Owen778
(Post 11969906)
A W4 is a form that you fill in. It tells them how much to deduct from your pay check (cheque) for taxes each pay period. .....
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