Quote:
Originally Posted by kepp
Explain this to me then... When I added in my wife's W2 (she earned 25% of what I earned in '14) our federal return dropped by 60%. I don't see how that could have happened unless all our taxable income was taxed in the higher bracket.
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Sounds like she's not withholding very much. If you have a lower income (which presumably she does unless you're making $1m and she's making $250,000), then the default in most payrolls is that you won't be paying much or anything in taxes. So little or nothing gets taken out.
But she's not paying low taxes because her income gets stacked on top of yours. So she's actually paying a pretty high rate, and she's paying it on all of her income since your income has already sucked up the exemptions and deductions for the most part. So the little person with the green eyeshade wants a lot of tax money from her as the day of reckoning arrives.