Payroll Deduction: Fill & Download for Free

I distinctly remember the catalyst that started me down the path toward Libertarian-leaning views - it was the first year I was self-employed and had to write a check to the IRS for the taxes I owed.I didn’t even make that much money that year. Less than I had made working for an employer the previous year, actually. But when I was employed, the taxes were taken out of my paycheck automatically. I could see the amount withheld on the pay stub and all that, but I never had those dollars.You don’t miss money you never had. But once you’ve actually been putting those dollars in the bank all year, and then have to write a check to the government, there’s a huge psychological difference - you really feel it when you watch those dollars leave your bank account in a lump sum like that. And it starts to sink in how much of what you earn is going to Washington to be wasted by politicians.Honestly, I think if there were no payroll deductions and everyone had to write a check to the government to pay their taxes, there would be riots in the streets over how much we’re really paying.

When I signed up for UberX in 2013 (Washington DC) there was a $100 deposit for the Uber iphone, payroll deducted in $50 increments.

Washington has no state income tax. You will pay federal income tax, plus social security and Medicare tax.Social security tax is 6.2% of the first $118,500 of gross wages per person, for a total of $7,347. (Source)Medicare tax is 1.45%, or $1,740 on a $120,000 salary.For federal income tax, you get a standard deduction of $12,600 as a married couple, and exemptions of $4,000 per person ($12,000 for a family of three). This amount is subtracted from your gross income to get your taxable income.A $120,000 gross salary would then translate to a $95,400 taxable income for your family. Per the current tax brackets, the tax on this income would be $10,312.50 + 25% of the amount over $74,900, for a total federal income tax of $15,437.50.There's also the child tax credit. This is normally $1,000 per child, but it phases out for married couples with incomes over $110,000. With an adjusted gross income of $120,000 and one child, you would be eligible for a child tax credit of $500. This would bring your federal tax down to $14,937.50.This would be your maximum federal income tax. Any pre-tax payroll deductions (401(k), health insurance, etc.) would reduce your adjusted gross income. All of these deductions will reduce your tax by 25¢ on the dollar in your current tax bracket, and the first $10,000 of these deductions will increase your child tax credit bit by bit until you get up to the full $1,000.If you have enough itemizable deductions (mortgage interest, property tax, sales tax, charitable contributions, etc.) that these add up to more than your standard deduction, this could reduce your tax further. These deductions would also reduce your tax by 25¢ per dollar deducted, but these deductions would not increase your child tax credit.The most income-related tax you would pay is then $7,347 + $1,740 + $14,937.50, a total of $24,024.50. On a monthly basis this would leave you with $7,997.96.All of the above are 2015 numbers. Most of the constants used in these calculations (social security maximum wages, federal deductions, and tax brackets) are updated each year for inflation.Please do consider maxing out your 401(k) and IRA accounts. A family of three can live a happy, comfortable life in Seattle on much less than $8,000/month, especially when you don't need to pay for child care.