General Question

djereska's avatar

I live in CA and just received my first pay stub. My employer did not take out state taxes even though I completed a w-2 telling him to do so.

Asked by djereska (4points) January 17th, 2014

I started in December with the company and my first 2 paychecks were handwritten and I was not given a pay stub. I resigned last week and yesterday was given my normal check (he still owes me for 3 days) and told I was no longer needed. This check had a pay stub and I noticed that he did not take out any state taxes and very little Federal even though I claimed married 1 on my w-2. I think something illegal is going on. I was told by a friend that he has to match the amount of taxes so the least amount possible he can take out benefits him. Is this true and should I report this to the IRS?

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5 Answers

zenvelo's avatar

Since you worked so little, you probably haven’t worked enough to be liable for income tax at either the State or Federal level. I’d call the California Franchise Tax Board first, IRS second. You might get a reward if they find him not paying taxes.

Judi's avatar

He has to match social security, not taxes.
You filled our a w-4 not a w-2, you are waiting for your w-2 for December where you will discover exactly how much they withheld for that month.
If you think they didn’t withhold enough then you are lucky you only worked less than two months. It shouldn’t make a huge difference on your taxes.

djereska's avatar

Thank you both so much for responding. Yes, you are right it won’t affect me much so I am not to worried about that part of it. But what the real question was – he did not take out the taxes that I asked him to based on my w-4. If I trusted him and never checked (which I didn’t and the reason I quit) it could have been a real problem. Is it illegal for him to not take out the requested taxes? I assume if he is doing this to me he may be doing it to other employees as well.

JLeslie's avatar

@djereska If your check was very low it probably did not break the threshold to withhold taxes, he isn’t necessarily doing something illegal. It’s up to the employee to make sure taxes are being withheld as they want them to be. When I was self employed we had my husband’s employer withold extra taxes from his check so I didn’t have to worry about paying taxes myself throughout the year. Some people do the opposite and have lower taxes held from their paycheck, because they know they will have write-offs or only work part of the year and not owe taxes. There probably is some sort of rule about employers withdrawing what the employee requested on the w4, but I doubt your employer is trying to do something illegal or get away with anything. Whether he holds taxes or not doesn’t affect his bottom line. He dies have an obligation to pay his part of social security though. I’m not a lawyer, and I am not defending your employer, I am just saying you need to make sure a certain percentage of your taxes are paid by the end if the year to avoid a penalty. You are responsible for it in the end.

flip86's avatar

I claim 1 on both state and federal. Occasionally, no state taxes will be withheld from my check and when they are, it usually isn’t much. Also, claiming 1 on federal taxes lowers the amount withheld. Withholding is based on a certain percentage of wages.

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