If you say married filing jointly without going to the next steps they assume you are the only income earner. Taxes are withheld so that it is like that is the only income for two people combined versus each having an income and therefore you end up under withholding.

I wasn't aware I had to do this. We've had two jobs since December of 2020 but this multiple job step 2 stuff you're bringing up is new to me. Could you please clarify?

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You're not lost, you're here! You made it. Step 1, complete!

The next step, step 2, is a bigger step. Education. We are all learning, because all of our lives and situations are all different and always changing. The terms you are seeing here and in the link above, look them up and start to learn how the different elements map to your situation. A big thing you'll hear is making a budget and outlining your goals. Both will help you here too.

Ah thank you!

Are you saying you only put married filing jointly, and did not fill out the multiple job worksheet in step 2?

Then that’s your problem. You guys have 2 jobs and failed to inform your employers to withhold as such.

But did you indicate you both work on each of the other’s W4? If not each of your incomes is being treated as the sole income for two people when in reality there are two incomes.

Invest up to match in 401k first. Free money from the match. Then max out IRA. IRA will have more things you can invest in and probably lower fees.

The Fidelity Cash Management account is a type of brokerage account. What I was trying to say, in answer to OP's question, is that you cannot have the money deducted directly from your own personal bank account when you buy a T-Bill, you must have the money in your Fidelity brokerage account (whatever type of Fidelity brokerage account it might be).

Fair. But conversely, you could take earnings from your W2 (which your competition doesn't have) and spend that money on your business to give you an advantage, couldn't you?

Your w4 was switched to the married withholding rate.

> However, she claim's 1 dependent.

"Claiming" things is no longer a thing and hasn't been for a few years. Update your W4. If your employer still has exemptions listed as an option, it's very very very behind the times.

If you haven't updated your W4 in a few years, both of you should update it.

And pay attention to Step II of the new W4.

At first I thought your idea was odd then I realized that is how we’ve always moved houses because … well, we always moved states. We had to rent while looking for a new house to buy. It never took us a year, though. We hate renting. 7 months in a crappy apartment was stressful enough for us.

The only time we didn’t rent was buying the house we are in currently. We planned on a smooth transition but the buyers’ attorney for the house we were selling was awful. He delayed the closing for over 2 months. Luckily we didn’t have a mortgage so carrying two houses wasn’t an issue. When he threatened yet another delay in the closing we told him we were going to refuse the extension because our house had gone up in value (about $30k). They panicked and we closed within a few days. I have no idea what he was thinking. He then had the gall to chastise us for forcing him to do a remote close. We had already moved hundreds of miles away! Had he closed on time, we would have been there in person.

Anyway, that was the worst closing I’ve ever had. Usually it is nothing more complicated than loading up the truck and handing the keys over after signing some papers. I’ve even been driving away as the new owners were pulling up with their truck.

We both have married filing jointly.

I do not claim any dependents on my W4 and everything else looks like it's zero.. She claims 1 dependent on her W4 and everything else is 0

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Love the user name! You are absolutely correct. We rented for a few months between the sale of my house and the purchase of our new house together. It was worth it because what I could afford and he could afford was significantly different. We had to find something he could afford on his own if something happened to me or my job as the lower earner but also not be too far of a commute for me every day. It was a beast to do but we managed somehow.

My wife files a Married filing jointly as well. However, she claim's 1 dependent.

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>Can someone please help me try to understand this?

You both filled out your W-4s as if you were the only job holder. If you have a dual income household, you need to either both check box 2c or input an appropriate amount into 4c to account for the dual incomes.

I'd say an easy 4/5 people doing Instacart/Ubereats/Gighustling aren't upping to commercial insurance required by using your car as such. If he told his insurer he was getting ready to make a delivery when you got hit they'd DQ him in a heartbeat to stop from paying you.

Oh yeah I brain farted my bad. Yeah with the two kids you owe ~$3300 excluding any retirement contribution deductions or any other misc. credits. It looks like you both selected “Married filing jointly” on your W4 without doing Step 2/work on Page 3.

Without knowing any of the numbers, I would say: yes, this is a bad idea.

So many things can happen in a year. Is it worth the risk of something going sideways and now you have no home?

I do have paid maternity leave and quite a bit of sick and vacation time that needs to be used prior to the end of the year, so my cash flow is no issue at all. Thanks!