to find the
Federal Income Tax
convict those who
fail to file a tax
return. The average
sentence is more
than three years.
Where’s All My Money?
Jack Myers blinks, rubs his eyes, and
blinks again. “Wait. Hey, there’s no $1,200 in this paycheck.” His
brother Jon, a certified public accountant, has been trying to tell
him that he needs to take into account withholdings from his pay-
check. One large chunk of the money he thought he was going to
get actually goes to paying FIT. “This is going to affect my truck
payment,” Jack said. “I thought there was going to be more.”
What do you do when your bills are more
than your paycheck amount?
Continued on page 119
Federal taxes are necessary to keep the government agencies and services afloat.
Employers are required by law to withhold a certain amount of your pay for
(or FIT). The Internal Revenue Service (IRS) provides
employers with tables that show how much money to withhold. The amount
withheld depends on your income, marital status, and withholding allowances.
You may claim 1 allowance for yourself and 1 allowance for your spouse if you
are married. You may claim additional allowances for any others you support.
Use table Married Persons Weekly Payroll on page 790 for Examples 1 and 2.