New Federal Tax Tables for 2011, 2012

Taxpayers will take home more pay in each paycheck thanks to the new Making Work Pay Credit and the new federal tax tables. You will not have to take any action because this is handled by employers and the credit will automatically start showing up in paychecks.

If you’re married and have multiple jobs, you may want to make sure you’re having enough withholding taken out or else you will end up owing Uncle Sam at the end of the year. Revise your W-4 form to ensure enough withholding is held to cover the tax for the combined income or multiple jobs.

On the IRS website you can find a PDF for the new withholding tax tables if you need exact numbers. They have the percentage method listed, the advanced earned income credit payment tables, and withholding adjustment for nonresident aliens.

Taxable Income

If you look at the new federal tax tables online, keep in mind the amounts are usually for taxable income --the amount left after all credits and deductions. Overall tax numbers appear to have a slight increase due to inflation.

Federal Tax Table Examples

If you’re married filing jointly with an income of $69,000, you will fall into the tax rate of 15%. If you’re single and make $34,501 - $83,600 per year, you will be categorized into the 25% tax rate.

The tax rates begin with 10%, advance to 15%, 25%, 28%, 33% and stop at 35%.

For married filing jointly, the 10% tax rate category ends at $16,700. For married filing jointly, the 35% tax rate begins at $379,150 per year. You can use these figures to estimate into which tax bracket you might fall.

Tax Advice

If you would like to see your income level drop to a lower tax bracket, make sure you claim all of the tax credits and deductions you qualify to claim. Many taxpayers miss out on tax breaks because they don't realize that they are eligible to claim a deduction, and often don't even know the deduction exists.

The best tax advice I can give you is to use online tax preparation software. These amazing tax wizards run through the deduction lists like a speeding bullet.

Tax Laws for the New Tax Year

Another advantage to using tax software is that this software is totally up to date on the new tax laws. I’ve listed a couple of good reasons to try online tax preparation software; go take a look and see how efficiently and accurately your tax return form can be filed.

Don’t worry about putting your Social Security number into cyber space.

Tax preparation companies like TurboTax Online use a powerful firewall and the same security encryption the banks use. Your information is safe, secure, and protected. Visit TurboTax Online Today!