Hey everyone, it’s Finance Fridays again. Today will be a short post about “Hawaii State Income Tax“.
For those who don’t know, I live in Hawaii.
As of December 31, 2017, they increased the number of marginal tax brackets, putting the 9%, 10%, and 11% tax brackets back in for the 2018 tax year.
Here they are:
Taxpayers who file a joint return will pay:
- 9.00% on taxable income over $300,000, but not over $350,000
- 10.00% on taxable income over $350,000, but not over $400,000
- 11.00% on taxable income over $400,000
Heads of a household will pay:
- 9.00% on taxable income over $225,000, but not over $262,500
- 10.00% on taxable income over $262,500, but not over $300,000
- 11.00% on taxable income over $300,000
Unmarried individuals and married individuals who file separately will pay:
- 9.00% on taxable income over $150,000, but not over $175,000
- 10.00% on taxable income over $175,000, but not over $200,000
- 11.00% on taxable income over $200,000
As you would expect, this affects pretty much all physicians since a dual physician income is likely >$400,000 and the majority of single physicians will make more than $200,000. We will all see some portion of the highest marginal tax bracket.
My own taxes have not been calculated yet, but anecdotally a two physician couple I know will owe $8000 this year and a single physician friend of mine will owe $4000 this year.
So, if you extrapolate that, I’ll probably owe $8000 this year. However, some of my friends did receive a slight refund from their federal taxes. So I am hopeful that a small federal refund will keep me in the +/- $5000 range that I try to keep our taxes in, but who knows?
Perhaps this will be another one of those times where I owe a lot of money, like my first full year as an attending.
Anyways, this just another reminder to try to stay on top of your taxes. I was vaguely aware that they were increasing the state income tax brackets for 2018, but I forgot to make adjustments to my withholding.
Nothing is certain but Death and Taxes.
I’ll probably owe the government some money this year for state taxes.
I forgot about the new marginal tax brackets.
I need to remember to try to stay on top of this for any future withholding adjustments.
Death and Taxes.
Agree? Disagree? Questions, Comments and Suggestions are welcome.
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