The amount of taxes taken out of a $500 paycheck in Michigan for a minor can vary based on several factors, including the type of job, whether the minor has opted for any additional tax withholding, and the applicable tax rates.
For general guidance, here's how you might break it down:
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Federal Income Tax: As a minor, if you earn $500 and your total annual income is below the standard deduction (which is $13,850 for 2023), you may not owe any federal income tax. However, employers typically withhold some federal taxes, usually around 10% for lower income brackets, so you might expect around $50 to be withheld.
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Social Security and Medicare Taxes: Typically, these taxes are withheld regardless of age. The rate for Social Security is 6.2%, and for Medicare, it's 1.45%. Together, that's approximately 7.65%. For $500, this would be about $38.25.
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Michigan State Income Tax: Michigan has a flat income tax rate of 4.25%. For a $500 paycheck, you might expect about $21.25 to be withheld.
Summary of Deductions:
- Federal Income Tax: ~$50 (varies based on circumstances)
- Social Security: ~$31.00
- Medicare: ~$7.25
- Michigan State Tax: ~$21.25
Total Deductions:
- Federal Income Tax: $50 + Social Security: $31.00 + Medicare: $7.25 + State Tax: $21.25 = $109.50
Total After Deductions:
- $500 - $109.50 = $390.50
Keep in mind that actual tax withholding can vary, and if the minor could claim exemptions or if their income is below certain thresholds, their withholding amounts may differ. It’s always a good idea to consult a tax professional or refer to IRS guidelines for a more personalized assessment.