Quote:
Originally Posted by Rain Man
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.
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So if my income took us to the edge of a bracket, all of her taxable income would be taxed at the higher bracket. And since her income was originally taxed at a much lower rate than the higher bracket, the difference is sucked back out of of the refund. I guess that makes sense. It makes me wonder if it would have been better to file individually instead of jointly.