Newspaper article The Florida Times Union

Managing Paycheck Is Part of Worker's Job

Newspaper article The Florida Times Union

Managing Paycheck Is Part of Worker's Job

Article excerpt

Byline: Candace Moody

Sept. 5 to 9 is National Payroll Week 2016, dedicated to honoring the one corporate function in every business where 99.9% accuracy is simply not good enough. Payroll professionals are held to a standard of complete accuracy every payroll cycle; nothing has more influence over worker morale than a mistake in payroll - even a small one. Many workers don't really understand what goes into and comes out of their paycheck. Do you?

At every stage of your career, it's important that you understand your paycheck and manage your money well. You can start by reviewing your tax withholding and benefits. Be sure that you are taking advantage of pre-tax withholding for medical and dental coverage if your company offers that option. Subtracting the premiums before taxes means that the net amount you're taxed on is lower. If your company does not offer that option, ask for it. It's a no-cost way to increase the amount you take home in each paycheck.

Federal income tax, state income tax, local income taxes and FICA taxes are among the required deductions from an employee's paycheck. We don't pay state or local income taxes here in Northeast Florida, but if you earn income in Georgia or another neighboring state, you'll see them. According to salary.com, Georgia residents pay 6 percent state income tax on every dollar earned over $7,000.

You control the amount of federal income tax withheld from your paycheck. Filling out the W-4 form when you're hired defines your marital status and the number of allowances you want to claim. The more allowances you claim, the lower the amount of tax withholding and the higher your take home pay. Some workers still use federal income tax withholding as a sort of savings plan, withholding the highest amount possible so they get a bigger income tax refund each year.

Only you can decide if that's a good plan for you. Many people consider their tax refund to be "found money" and spend it on a luxury purchase. …

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