So I am trying to make a budget for the next few months (until I get a full time engineering job). I just got a part time CAD job for 20 hours a week for $12.50/ hour. How much of my pay check is going to disappear to the government (roughly)?
So I am trying to make a budget for the next few months (until I get a full time engineering job). I just got a part time CAD job for 20 hours a week for $12.50/ hour. How much of my pay check is going to disappear to the government (roughly)?
really not much - you should be taking home 10/hr
Look up the tax brackets for your income level.
Calculate.
Come on, you're an engineer. 
I didn't know if part time changed anything. The other part time jobs I have had were... "cash".
30% Give or take.
30% is usually a good starting point, chances are you're looking at less tax so if you budget for 30% you'll end up with a little money left over. Not a bad place IMHO.
Looking at the tax brackets, if I go by what I would be making a year it would be 15%.
No way it's 30%.
It depends ENTIRELY on what you write on the W-4.
Tax liability is based on your annual income for the tax year.
If you've been unemployed for 6 months, expect to be employed 25 hours per week @ $12.50 per hour for 4 months, then expect to be employed for 2 months @ $25 per hour, the annual would be more like $13,000, which would likely leave you not owing ANY taxes.
Need more info to calculate but, as previously noted, you ARE an engineer! 
If it was me, I'd put 15 exemptions on my W-4 so they didn't withhold anything at all while I was working part time at lower rate, then calculate my anticipated annual and put a different amount of exemptions on my W-4 (perhaps 0) when I got the higher paying job to keep up with the tax obligation.
My rule of thumb on taxes is: "Uncle Sam, one way or another, will get at least 1 out of every 6 dollars". You are hired for $12/hour? Figure on seeing about $10 of that in your actual paycheck.
Sure is a lot of bad advice in this thread.
THERE ARE NO RULES FOR WITHHOLDING.
The employer will withhold whatever you tell them to, based on your W-4. If you do not have sufficient income for a tax liability, you don't owe taxes.
Even if you do have a tax liability, you are NOT required to have it withheld from your paycheck. You can have $0 withheld and pay the entire liability when you file your return. Most folks don't like doing it this way, but it IS legal.
legal, just expect to be pentalized for it
Well, they get almost 30% of me, and I am not making engineer bucks, not even close. 
You need, REALLY NEED, a good bookkeeper/ accountant. Mine saved us over 20K from IRS. Spend a few bucks, enjoy the benefits of a pro.
Lump me in with SVRex, jack up your exemptions and don't let them withhold. If you end up getting a real job, maybe consider having income tax withheld, but if you're working part time for 12 bucks an hour you aren't going to hit the minimum income threshold for tax liability (can't remember the exact amount, but I think it's somewhere around $7000). If you accidentally do, you'll still be well under 15k in total income. Keep some cash on hand if you can, and you can eliminate any tax liability you might incur by contributing to a retirement account and claim the saver's credit (you should be in the 50% bracket). Basically, if you make under 16k or so (number changes every year), you can contribute to an IRA and get 50% of whatever you contribute back as a tax credit. I did this the first year I worked full time, I started working in the summer, and I made just enough over the year that I could still claim the 50% credit. I would have owed $375 in taxes at the end of the year, but I put $750 in an IRA instead and brought my liability down to zero. It's a much better deal to pay double to myself than anything to uncle sam.
I jacked up how much they take out... I came VERY close to owing this past year and when that bill comes due.. it is my slowest time of the year.. so giving a little more to uncle sam to get some back when I am not working that much.. is a LOT better than trying to find cash to pay the IRS
mad_machine wrote: I jacked up how much they take out... I came VERY close to owing this past year and when that bill comes due.. it is my slowest time of the year.. so giving a little more to uncle sam to get some back when I am not working that much.. is a LOT better than trying to find cash to pay the IRS
I know it's not this easy for some people, but the obvious way to avoid that situation is to set up a regular auto-deposit to a high interest savings account for roughly the amount that would have been withheld. ING Orange is giving $25 bonuses just for opening an account right now, so you'd start out $25 ahead and gain from there.
GrantMLS wrote: legal, just expect to be pentalized for it
Absolutely not.
There won't be any penalty if no taxes are due. (Likely the OP's position).
If you pay at least as much as you paid last year- no penalty.
If you don't owe taxes and make no payment- no penalty.
If you make payments (or withholding) and pay enough so that the amount you owe when you file is less than $1000- no penalty.
The W-4 is only a directive to an employer for how much to withhold, and the quantity of exemptions is only for the purpose of ESTIMATING tax liabilities. There is NO REQUIRED amount of withholding, only that you do not get to the point where you owe the IRS more than $1000. You tell your employer whatever you want, and they withhold it (or do not if you tell them not to).
If you underestimate the withholding, of course you will be responsible for paying the difference when you file your 1099. Fail to due so, and there will be penalties.
Edited for accuracy
I have always had a W-4 on file and have been knocking on the verge of having to pay underwitholding penalties for years, even though I take ZERO exemptions on my W-4. I even have them withold at the single rate though I am married. In fact this year if I hadn't taken a pay cut I would have been required to file quarterly.
While I admit I make more than $12/hr, you simply can't make blanket statements like that.
There is no withholding penalty if there are no taxes due.
However, I still stand by my earlier suggestion.
You've spent 6 months unemployed, right? And you are now working 20 hrs. per week @ $12.50.
Since you are only working half time, the $12.50 is the equivalent of $6.25 (if it was full time). That's less than minimum wage. But, you spent half the year unemployed. So, it is the annual equivalent of a job that paid $3.13, or $6500.
YOU DON'T OWE ANY TAXES. They will be paying you, because you will (likely) qualify for the Earned Income Tax Credit.
Where in the world are people coming up with 30%???
Edited for accuracy
He's still going to be subject to Social Security and Medicare taxation. However, given his likely annual income this year, you're right, he won't be at 30%.
SVreX wrote: Where in the world are people coming up with 30%???
I didn't say it, but I lose about 30%.
401K 9%
Social Security
Medicare
IRS tax - I have a flat rate taken out.
Family Plan Blue Cross Blue Shield of Michigan
I apologize, my number is irrelevant. YMMV.
pete240z wrote:SVreX wrote: Where in the world are people coming up with 30%???I didn't say it, but I lose about 30%. 401K 9% Social Security Medicare IRS tax - I have a flat rate taken out. Family Plan Blue Cross Blue Shield of Michigan
businesses, not taxes.
30% seems about right for me as well. Not just income tax withheld, but also including all the other ways they take the fruits of your labor. They hide half of your FICA taxes by saying that your employer pays those, but if they didn't have to pay them to the government they could pay them to you. There is a penalty for not witholding enough, but you can get around it by making quarterly estimated payments. I got a nasty gram this year adding insult to my injury after writing a large check at tax time, then getting a followup notice that I may be penalized for not paying throughout the year. Absurd.
I think for the OP's case (part time job) the advice to minimize withholding makes sense.
I have no doubt that many of you have 30% in withholding.
The OP didn't ask how much WE all have withheld. He asked how much would be withheld from HIS check.
The correct answer is: The amount withheld will be whatever you tell your employer to withhold on the W-4, and that you don't have to tell him to withhold much, because you won't owe much. Therefore, you won't have any penalties.
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