One of our many goals here at The Free Coupon Resource Center, is to educate our audience, with applicable knowledge. This knowledge in turn, can be used in everyday situations, without paying someone else to give you the information. This site, goes beyond sign ups for printable coupons, and cashback savings. In this article, we shall share some special information, which you can apply to your current payroll situation, if you work a 9 to 5, or a 7 to 3 everyday or part-time.
It is a little known fact, that many employees, totally lose 1/3 of their income to taxes! This means that even after they file their annual tax return, and receive a decent refund check, that the individual, and more importantly, the employee’s family or their household, loses that income forever. The lost money, from these income withheld deductions, goes to the Federal Government for Earmarks and $25,000 toilet bowls. This means less money, for shopping and using your favorite free printable coupons, to get the best deals at your local grocery store. We now would like to share some interesting free information, which can help you add instant income to your payroll check, legally and without penalty, from the IRS and your employer.
One of the most important aspects of working for any employer, in the United States, is the completion of The Department of Treasury IRS Form W-4 Form. The W-4, is a very important document to our lives financially. The USA Today and many other news publications, have featured articles on the W-4 and employee tax withholding. A major point made in the articles is millions of employees allow the IRS to withhold too much money from their paychecks throughout the year.
The articles also made the point that the employees would be better off having less money withheld from their paycheck, which would increase their take home pay. The employee could then use the extra take home pay to increase the investments to their retirement fund or pay off debt earlier. The IRS issued a bulletin on April 29th, 2005 that made the same points. Imagine having an extra $500 per month or $6000 per year in take-home pay. Using that extra cash flow to build your retirement investments or to eliminate debt could be life changing. One key indicator to know if too much money is being withheld is that you receive a refund each year.
These refunds, are the highlight of everyone, who files taxes, in the United States of America. The problem with these refunds for taxpayers, is that they do not represent, all of the taxes withheld throughout the year! Even when people, use tax exemptions throughout the year, they don’t see half of what they could see within their paycheck, every pay period! It is because of this loss of money, which causes many Americans worldwide, not be able to achieve maximum, financial freedom and retirement capability.
Minimizing taxes is a very important strategy because the typical American loses about one third of their income to taxes. This loss of income quite often, prohibits millions of people from investing enough dollars to build an adequate retirement fund. When you crunch the simple numbers together, it makes total mathematical sense.
If a family earned $85,000 a year for 40 years they would have lifetime earnings of $3,400,000. If the family paid 30% in taxes they would lose $1,020,000 to taxes. However, if the family paid 20% they would lose only $680,000 to taxes. If the difference of $340,000 was invested at a reasonable rate of return, the family would amass a solid retirement fund. One of the first steps that you will be able to make, is to totally pay off your debt, and strengthen your credit score and bank accounts savings. Imagine yourself, being able to pay off a 5 year car note in 18 months, or paying off a $80,000 30 year student loan, in 15 years or less!
Minimizing taxes is literally one of the most important financial strategies in America.
When you think about it, if you could “stop paying taxes legally”, you would then have extra money after day to day expenses, to apply towards debt and other forms of “creative financial investments”. As always, the free money, can help you organize and upgrade your current lifestyle immensely.
Adjusting or correcting the W-4 is simple. You can use the Electronic Withholding Calculator on the IRS website at irs.gov or use the paper form. Simply read the form line by line and fill in the spaces. If you use the paper form, be sure to fill out page 1 and 2, if necessary. Some states also have a state tax withholding form. You may also want to check your state tax withholding form to see if too much money is being withheld throughout the year.
The entire month of March 2016, will feature interesting articles, which will show you exactly how to take advantage of these unknown techniques, without the fear of an IRS Audit. We also want to know, what tax techniques you use, to maximize your paycheck every pay period?