   
|
|
Withholding Tax
|
| FYI - For 2011, Dow up, Dogs of the Dow up more (double digits) |
| |
A withholding tax is a tax automatically taken from income received during the year. Individuals paying too much withholding tax will receive a tax refund; individuals paying too little withholding tax will owe additional taxes at the end of the year. The amount of withholding tax depends on the amount of income and the number of allowances claimed on the IRS Form W-4, Employee's Withholding Allowance Certificate: more allowances mean a smaller withholding tax. Taxpayers can adjust this number by submitting a revised Form W-4 to their employer. In addition, individuals who do not pay withholding tax, or fail to pay enough withholding tax, can lessen their year-end tax burden by paying an estimated tax. Income unrelated to wages is exempt from withholding tax, such as capital gains, interest, and dividends. As a result, individuals with considerable amounts of such income will owe more taxes at the end of the year. However, pensions, bonuses, commissions, and gambling winnings are not exempt from withholding tax.
Rate this withholding tax definition...
|
|
Where is the market headed? The answer may surprise you. Find out
right now with the exclusive & Barron's recommended charts of Chart of the Day.
|
Popular Terms: inflation, FICO score, EBITDA, labor relations, option premium, 1035 exchange, 144a, deferred revenue, limit order, balance sheet, ex-dividend date, dividends payable, command economy, current ratio, phantom income, required rate of return, average price per share, real GDP, FTSE, stock split, deferred tax, diluted share, margin rate, class C shares, debt service coverage, minority interest, open position, annual return, ex-dividend, 401a, risk management, reverse mortgage, covered put, in escrow, LIBOR, implied volatility, wholly-owned subsidiary, irrevocable trust, quality assurance, stock market close, liquidity ratio, cancelled check, 1031 exchange, APR, Key Rate Duration, Zero Cost Collar, per diem, retained earnings, VIX
|
|
| |