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Month: June 2023

How Many Allowances Should I Claim on My W4?

Londonderry, NH Resident Looks to Start New Job on the Right Foot

When you start a new job, to get paid via the company’s payroll each new employee will need to fill out
a W4 form. One of the most common mistakes on this form is how many allowances to claim. The
more allowances claimed, the fewer taxes will be withheld from your paycheck. However, if this
number is not correct for your tax filing at the end of the year you may be surprised with a hefty bill in
taxes that you owe. If you are single with one job or married filing as the of household you may want to
claim 1. Single individuals with more than one job or those married and dividing total allowances may
choose to claim 2. Those married with minor children living at home, will often choose three
allowances.

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How are Dividends Taxed?

Nashua, NH Resident Wants to Be Prepared for the End of the Year

Dividends are typically considered taxable income for the year that they are received and will be taxed
at the end of the tax year. Even if the money was not received in cash, being reinvested buying more
shares, it will still need to be reported and will most likely be subject to taxes. How this money is taxed
depends on your taxable income and filing status. The dividends will be considered either nonqualified
or qualified. Qualified dividends usually have a lower tax rate, 0% 15%, or 20% depending on your
income level. Nonqualified dividends are taxed at the same rate as your regular income.

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