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Wednesday, February 22, 2017

These states will take the most money out of your paycheck

These states will take the most money out of your paycheck

 



Getting your first paycheck is usually followed by the question, “Who is FICA, and why are they taking all of my money?”
Taxes can take a significant chunk out of your paycheck, as most workers are painfully aware, and it can often feel like you’re taking home less than what the government is taking. It’s a reality we all face, but a new study reminds us that where we live has a huge impact on how much we pay.
According to a study from GoBankingRates, workers in Hawaii get the most money taken out of their paycheck. An employee there making $50,000 a year will get a $1,923.08 paycheck, assuming a biweekly pay cycle. In the Aloha State, $542.24 of that will go to pay for things like the Federal Insurance Contributions Act taxes (FICA), which is a tax used to fund older Americans’ Social Security and Medicare benefits.
In addition to a high state income tax (8.25%), locals in Hawaii have more money withheld from their paychecks thanks to items like the State Disability Insurance (SDI), which is only applicable in four other states.
While Hawaii leads the charge on money withheld, there is some close competition. Other states taking the most out of your paycheck include Oregon ($538.05), Idaho ($528.93), South Carolina ($524.95) and Minnesota ($515.93).
For workers making $100,000 a year, Oregon will take the most out of your paycheck. On a biweekly pay cycle, an employee with this salary will earn $3,846.15. From that, $1,340.95 will be withheld to pay taxes to the state of Oregon. Other states withholding the most money at this salary level are California ($1,335.66), Hawaii ($1,324.69), Idaho ($1,301.83), and Washington, D.C. ($1,297.83).
The study’s methodology is based on a person with single filing status, one federal allowance, no round federal withholding and zero additional federal and state withholdings. The money withheld includes federal taxes, state tax, FICA, Medicare and other withdrawals, like the State Disability Insurance (SDI) and the State Unemployment Insurance (SUI).
Lucky for us, not all states are created equal. Thanks to the lack of a state income tax, workers earning $50,000 in Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming will see just $402.93 taken out of their biweekly paychecks. Alaska doesn’t have a state income tax, but workers will pay a bit more ($412.55), because of state unemployment insurance.
For those earning $100,000, a biweekly check will be $3,846.15. With no state income tax, workers in these states will pay about $1,032.83 in taxes, or about a quarter of their earnings. Alaska deducts slightly more, $1,052.06.

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