Deductions

roybean · 12-01-2006, 08:58 PM

Here's something I keep forgetting to ask...I want to have as many deductions as possible taken out my checks. What's the best way to do this?

jlynn · 12-01-2006, 09:03 PM

You mean so that you don't owe any taxes?

Hedwig · 12-01-2006, 09:12 PM

Have single, zero deductions.

You can even have extra withheld each pay period if you want. Just put the amount on the W-4 form.

spinn · 12-01-2006, 09:13 PM

Why would you want to make an interest free loan to the Govt?

Or do you mean in settlement checks?

Hedwig · 12-01-2006, 09:14 PM

Actually, I may have misunderstood. What I gave you gives you the maximum taken out of your check and you would get a refund.

If you want to avoid getting a refund you want the number of deductions to be higher. I think 10 is the maximum before the employer has to report, but I'll have to check on that.

roybean · 12-01-2006, 09:25 PM

What I mean is...if anyone wants to garnish my paychecks. This has not happened to me and it probably won't, but just in case.

roybean · 12-01-2006, 09:39 PM

If I buy a car, can I have the note holder to take money right out of my check???

Gee. What happened?

jlynn · 12-01-2006, 10:09 PM

Roy, you would have to look into your state's laws to see if garnishments are calculated, based on GROSS or net wages. If its gross - all the deductions in the world won't help you. If its net wages, then you need to see if the statutes speak to what is allowable to calculate net.

Or save yourself the trouble and move to Texas.

roybean · 12-01-2006, 10:12 PM

My understanding is that if you have other obligations, no one can just cut in front of anyone else. They have to get in line and no one can take more than what you need to live on.

boyblue_77 · 12-01-2006, 10:37 PM

Quote:

Originally Posted by roybean

What I mean is...if anyone wants to garnish my paychecks. This has not happened to me and it probably won't, but just in case.

Do you mean trying to make yourself judgement proof? Well, I read that if you increase your fed. and state taxes as much as you can on your W-4 to leave you with the bare minimum of take home pay, there will be nothing left to garnish. You will be living like a pauper all year long, but when you get your tax refunds you should get a nice chunk of change back. The tax refunds cannot be touched by the CAs, JDBs or creditors who placed the garnishment.

roybean · 12-01-2006, 10:50 PM

Quote:

Originally Posted by boyblue_77

Do you mean trying to make yourself judgement proof? Well, I read that if you increase your fed. and state taxes as much as you can on your W-4 to leave you with the bare minimum of take home pay, there will be nothing left to garnish. You will be living like a pauper all year long, but when you get your tax refunds you should get a nice chunk of change back. The tax refunds cannot be touched by the CAs, JDBs or creditors who placed the garnishment.

I think you have to do a little more than that....

jlynn · 12-01-2006, 10:53 PM

Quote:

Originally Posted by roybean

My understanding is that if you have other obligations, no one can just cut in front of anyone else. They have to get in line and no one can take more than what you need to live on.

I believe the IRS can cut in front of anyone....not 100% sure on that. I do know in Texas at least, a tax lien will move you to first in line on owned property, including 1st mortgage holder!

Lucy · 12-02-2006, 05:24 PM

Look here

www.bcsalliance.com/y_debt_statelaws_garnishments.html

roybean · 12-02-2006, 05:33 PM

Ok, I will check it out.
Thx

Hedwig · 12-02-2006, 06:23 PM

As jlynn said, check your state laws and let me know if it's net or gross. Also, the state law should tell some sort of order of precedence--in other words, maybe a secured creditor can jump to the front of the line. Every state is different.

As far as your other question goes, many creditors will set up and automatic deduction from your bank account. My cars are financed with a credit union, and they will only take money from accounts at their credit union. So I always put some money in the savings account and have them take it from there. It gets interest until the day the payment is due.

So, the answer to both is really "it depends."

hannah · 12-02-2006, 06:56 PM

Quote:

Originally Posted by boyblue_77

The tax refunds cannot be touched by the CAs, JDBs or creditors who placed the garnishment.

Unless you owe child support, student loans, and other types of government loans. They CAN take your refund and what's more is that your state can also place a tax lien (no law suit needed) on any federal tax refund and vice versa.

boyblue_77 · 12-02-2006, 07:02 PM

Quote:

Originally Posted by hannah

Unless you owe child support, student loans, and other types of government loans. They CAN take your refund and what's more is that your state can also place a tax lien (no law suit needed) on any federal tax refund and vice versa.

I was talking about CAs/JDBs collecting for past due credit accounts. You are right though, child support, student loans, and government loans can definitely touch refunds.

roybean · 12-03-2006, 06:33 PM

What I want is for my paycheck to be left with the bare bminimun amount that I need to live on in which case nothing else can be taken out.

Enigma · 12-03-2006, 06:44 PM

You need to look at your state laws.

Some "creditors" have priorty over others.

Just because you have your auto loan taken out of your direct pay, does not mean anything.

If I get a garnishment order I hae priorty over your car loan.

Such things as child support, IRS levies, etc all have priorty.

Hedwig · 12-03-2006, 06:47 PM

Claim single, zero deductions. Get a check and see how much it is. Figure what you need. File another W4 with single, zero deductions, and then specify extra withholding. You have to put in a dollar amount to be withheld each pay period.

Because I have some income that doesn't have withholding, I don't want to be in a penalty situation and I don't want a big tax bill at the end. So I have filled out my W4 as married but withhold at higher single rate, zero deductions, and an extra $x.xx per pay period. I did the same thing with state--zero deductions and an extra amount withheld.

Edited to add--you can do this several times during the year. Around Thanksgiving I usually check and if I need more withheld I can have even more withheld the extra few checks, then I go back to what I had in January.