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Djgb13

Should overtime hours be taxed?

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Do you guys think overtime hours should be taxed? And at higher rates than normal hours? 

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It should be taxed, but only at a rate consistent with overall income when added up. If you mean that you jump into a higher bracket on weeks you work more ot, that's only so that if you work those hours all year you won't be screwed come tax time.

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1 minute ago, Frozenbeernuts said:

It should be taxed, but only at a rate consistent with overall income when added up. If you mean that you jump into a higher bracket on weeks you work more ot, that's only so that if you work those hours all year you won't be screwed come tax time.

I was just reading online about people complaining that they work overtime to try and make a decent living only to have it taxed to hell and back. I haven’t experienced it and will admit I’m clueless as to the whole process of it. The benefits and downfalls of it. Figured you’d guys might have more insight on it and different opinions about it. 

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4 minutes ago, Djgb13 said:

I was just reading online about people complaining that they work overtime to try and make a decent living only to have it taxed to hell and back. I haven’t experienced it and will admit I’m clueless as to the whole process of it. The benefits and downfalls of it. Figured you’d guys might have more insight on it and different opinions about it. 

If they pay more in taxes than they should, they will get the money back on their refund. If they end up working all that OT all year, well higher taxes just come with a higher income

If it's that big of a deal, they need to change their W4 for weeks that they make more money. 

A simple way is to start the year on flat 50 for a few weeks, then switch back to a normal withholding. One can always put more in to their taxes each week if they want. 

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Income tax is theft. 

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People get more taxes out because the system isn't sophisticated enough to know that someone worked OT for a week.  They assume that's your new salary and start taking out extra taxes.

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6 minutes ago, nobody said:

People get more taxes out because the system isn't sophisticated enough to know that someone worked OT for a week.  They assume that's your new salary and start taking out extra taxes.

I was going to post this.  In my experience, and I'm not an accountant nor have I seriously done the math, that the tax tables simply extrapolate whatever your gross is over a pay period to an annual salary and tax accordingly.  If, at the end of the year, you aren't in the tax bracket it thought you were going to be, you'll get some tax back.  But there are a lot of idiots out there who don't understand this simple concept.  And they think they're getting taxed more.

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My sales commissions are taxed as special payments at a higher rate.  It makes it very hard to predict how much we will owe come tax filing time.  I can imagine OT pay has a similar problem.

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1 hour ago, jerryskids said:

My sales commissions are taxed as special payments at a higher rate.  It makes it very hard to predict how much we will owe come tax filing time.  I can imagine OT pay has a similar problem.

 

28 minutes ago, RaiderHaters Revenge said:

All income should be taxed at a flat rate

Withholding is at a different rate, but you aren’t TAXED at a different rate. You may get into a different bracket for your wage income, but OT, bonus, salary, etc. are just wage income.

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12 minutes ago, Patriotsfatboy1 said:

 

Withholding is at a different rate, but you aren’t TAXED at a different rate. You may get into a different bracket for your wage income, but OT, bonus, salary, etc. are just wage income.

 

I know I don’t withhold

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8 minutes ago, Drizzay said:

What is overtime?

Do you work salary or just never work more than 40 hours a week? 50 hours a week is a short week for me. I try for 60 at least since I am hourly

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Yes...  But I don't get paid OT, so it doesn't matter to me...

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4 minutes ago, posty said:

Yes...  But I don't get paid OT, so it doesn't matter to me...

This

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Yeah you are salary so it doesn't relate to you any way. I appreciate the hourly wage that allows me to choose how much I make on a month to month year to year basis to a degree. When work is plentiful, like it is near Chicago now for pipefitters, I have some nice options. Right now I am opting for 50 hours a week, but its 60 mins from the house in a fab shop just welding all day. Holy hell this is heaven (relatively speaking)

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1 minute ago, Frozenbeernuts said:

Yeah you are salary so it doesn't relate to you any way. I appreciate the hourly wage that allows me to choose how much I make on a month to month year to year basis to a degree. When work is plentiful, like it is near Chicago now for pipefitters, I have some nice options. Right now I am opting for 50 hours a week, but its 60 mins from the house in a fab shop just welding all day. Holy hell this is heaven (relatively speaking)

You should thank trump 

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5 minutes ago, drobeski said:

You should thank trump 

Ok. It may be because of him. I have said multiple times I am probably voting for him next year. Illinois is also the 2nd  most industrious state in the country, so that helps a lot. I don't hate Trump's actions. I think he can be childish, but I genuinely cannot stand sensitive PC things (even though Trump is as sensitive as it gets). I don't think moving toward a more socialist society is beneficial. I am a huge believer in balance. I want the republicans aka Trump to pair down spending before a D gets back in office (hopefully one who isn't aboard the PC train).

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When did they start taxing hours? Hope I’m not in trouble for  never reporting/paying.

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Always pixxed me off. I wad salaried forever, but the secy would bust balls if you didn't do timecard. 

I got so sick of trying g to explain that shiit  - or get an explanation.

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There could be many reasons why a salaried employee should do a timecard.   You may need to track hours billed to a specific customer.  Or you can use previous charges for specific tasks to capture costs to help you in bidding future work.  Or maybe they just want to track when people are coming and going.

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12 hours ago, RaiderHaters Revenge said:

All income should be taxed at a flat rate

Unearned?

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11 hours ago, Frozenbeernuts said:

Do you work salary or just never work more than 40 hours a week? 50 hours a week is a short week for me. I try for 60 at least since I am hourly

Union

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Since I’m not eligible for overtime, I’ll give the democratic socialist response...it should be taxed at 90% since everyone isn’t eligible. 

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Just now, avoiding injuries said:

Since I’m not eligible for overtime, I’ll give the democratic socialist response...it should be taxed at 90% since everyone isn’t eligible. 

BUT...put that taxed money toward cleaner energy or helping the less fortunate. Racist!!! 😡 

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14 hours ago, Patriotsfatboy1 said:

 

Withholding is at a different rate, but you aren’t TAXED at a different rate. You may get into a different bracket for your wage income, but OT, bonus, salary, etc. are just wage income.

You are correct, I misspoke.  It still creates a lot of variability though.  

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17 hours ago, Patriotsfatboy1 said:

Income is income. You aren’t taxed more for OT. 

How do people not know this?  Especially college educated, 34 ACT scoring doctors.  

  • Haha 1

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44 minutes ago, jerryskids said:

You are correct, I misspoke.  It still creates a lot of variability though.  

The whole withholding tables can be messed up as well.  

When we do year end bonuses, they will ask us if we want to make any changes to our dependents or if we want to have it not use the 401k settings before they run that payroll.  It allows people to control it a little more.  

My problem is more that my wife and I have joint income and we have to fudge with her withholdings because she makes far less than I do.  So, she does not get enough tax withheld during the year and we end up owing more based on her income.  For example, her withholdings are at about 12% of her income and mine is at 25%.  Combined our effective rate is closer to the 22% mark, so we end up owing because of her withholdings.

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op should just make the question....should wages be taxed? what does overtime have to do with anything?

then might as well take away the salary exempt and non-exempt BS

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4 minutes ago, Patriotsfatboy1 said:

The whole withholding tables can be messed up as well.  

When we do year end bonuses, they will ask us if we want to make any changes to our dependents or if we want to have it not use the 401k settings before they run that payroll.  It allows people to control it a little more.  

My problem is more that my wife and I have joint income and we have to fudge with her withholdings because she makes far less than I do.  So, she does not get enough tax withheld during the year and we end up owing more based on her income.  For example, her withholdings are at about 12% of her income and mine is at 25%.  Combined our effective rate is closer to the 22% mark, so we end up owing because of her withholdings.

I'm in a similar situation, but I'm able to adjust my bonus withholding to cover it (reasonably close).

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i just do a flat tax per pay. way easier. i don't mess with those withholding table rates, etc. i know what i make and will adjust it after i take bonuses, etc.

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3 minutes ago, Gladiators said:

I'm in a similar situation, but I'm able to adjust my bonus withholding to cover it (reasonably close).

I just know that the gubmint is giving me an interest free loan during the year and I make sure that I have the dough to cover that check on April 15th.  

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