Pre Tax Deductions
June 6th, 2009
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Question: When your payroll check is done, are the taxes calculated on total earnings – even with pre-Tax Deductions?
I have pre-tax medical and retirement taken out but when I calculate out how much of my total gross I take home, the percentages indicate the taxes are being calculated on total earnings, not the total after pre-tax deductions. I thought that was the benefit of pre-tax deductions – you didn’t get taxed on it. If anyone knows of the legal writings for payroll practices, I would like to know, thanks.
Answer: Tish is correct + don’t get hooked staring at the stub. You find out how much you really pay by doing the return. Only if the W-2 seems to have too much gross fed taxable (ie Pre-tax items not excluded) should you even pay any attention at all.
Items on Amazon Right Now for Pre Tax Deductions:
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Deducting Employee Contributions on a Pre-Tax Basis
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