Hello. This isn’t necessarily a question about brackets as I understand how they work. This is a question about how those brackets are applied throughout the year. I am trying to refine my spreadsheet to filter all my imported pay stubs and automate the federal income tax cell. I think I’m getting confused about what income data they are basing my bracket on: is it just an estimation based on my current paycheck, an estimation based on all my paychecks this year, etc.?

So I am in the 22% bracket covering only about $6000 of my paycheck. I am not interested in how much my year end taxes paid will be, but rather what my taxes on a specific paystub will be. Here’s the formula I’ve been using and it’s always a few dollars off:

Fed Income Tax per Pay = $179.38 + 22%*(Gross-reimbursements-deductions-FICA-State income-$1558.69)

Where I got those #:

$179.38 = (Total taxes paid 10-12% / 26) = $4807.50 26

22% = Current bracket

$1558.69 = Bracket floor / 26 = $41776 / 26

Typically, each paycheck is annualized (multiplied by the number of paychecks per year) and withheld based on that annualized calculation and the information you provided on your W-4. They do not look at prior cumulative or expected future paychecks. Just each paycheck in isolation.

The full details (and other methods) can be found in IRS Pub 15-T: https://www.irs.gov/pub/irs-pdf/p15t.pdf

It changes constantly based on your rate of pay and whatever info you put on your W-4, you can set it to a fixed amount every month, just let your HR lady know

It’s calculated per paycheck. Annualized by dollar amount you were paid and your pay frequency.

Technically, your paycheck isn’t taxed. You have money withheld to cover your tax liability. When you file your tax return for the year, all you are doing is truing up the difference between what was withheld and what your actual tax liability was.

As far as the question of how are paycheck withholdings determined, that depends on how you filled out your W4, how the income you receive is classified, and how your company payroll chooses to operate.

I am having a hard time visualizing what it is you are trying to do with this spreadsheet and the data you are trying to calculate. If it isn’t important, I would probably just not worry about trying to figure out this calculation, as it gets very complicated. If it for some reason is important, I have no idea why or what you are needing this for.

It is projecting where your total income will be at the end of the year. Assumes your current period pay rate will be your pay for the rest of the pay periods. But what you’ve already been paid on previous pay periods is known.