How can i calculate the cumulative percentage?

How do I calculate az income tax withholding percentage?

• I am new to Arizona and don't know how to calculate the percentage withholding.  The instructions don't tell you how to calculate the percentage.

• Answer:

  You are right.  If you don't know where you want to end up, it can be very hard to figure out how to get there. Arizona Department of Revenue tries to be helpful on the Form A-4. On Page 2 of the online  A-4  they have a calculator to help you. But when you get to Line 4 - your annual withholding goal - you have no idea what to enter.  So the rest of this calculator is worthless.  What should your goal be? http://hr.az.gov/State_Employee/PDF/News_AZTaxForm.pdf At this point you have to go the the AZ Form 140 Instructions.  On pages 27 - 32 of the instructions are Optional Tax Tables for people making under $50,000 per year.  On page 33 are Tax Tables X & Y for people making over $50,000 per year. https://azdor.gov/Portals/0/ADOR-forms/TY2014/10400/140Booklet.pdf   Now we can figure out this problem and find your goal. I will assume you are single making $36,000 per year.  Looking at the optional table on page 31 your tax would be $1,061.  So 1,061/36,000 = 2.95%.  The A-4 gives you the options of 2.7% or 3.6%.  At 2.7% you would owe $89 on April 15.  Not fun but not terrible. At 3.6% you would get a refund of $235.  That money might have come in handy during the year, but it is usually fun to get a refund.  If you make over $50,000 you have to go to Page 33 and work through the calculations. This being your first year, you will only make part of your annual wages/salary.  So you can go with the lower percentage and then at the start of next year give the Payroll Administrator a new A-4 at a higher percentage. So with 2 months left in the year, your salary for 2015 will be $6,000.  Looking at the Optional Table on Page 28, the tax on $6,000 is $156.  So $156/$6,000 = 2.6% so check Box 2 on Page 1 of the A-4 and select 2.7%. Hope this helps. ps.  If you don't like math, just use the Goldilocks method.  Not too much and not too little. Pick the one in the middle and hope for the best.  This would have given you 2.7% or 3.6% which is what our calculations confirmed.  :)