Best Answer: As you posted this on the UK site, I am assuming you are a UK resident and UK domiciled person who is considering taking employment within the USA.
I am also assuming you are on a visa permit to work in the USA (i.e. not a student, teacher, diplomat, or any of the other special visa classes), and assuming you are living in the US for at least a full year.
US income taxes are graduated rates, ranging from negative amounts (for very low income people) to as high as 35%. We really need to know how much income you will be getting to answer your question. We also need to know your marital status and whether you have children. Let's make your hypothetical case a single person with no kids, $100,000 annual income, and the standard deduction.
US income tax will be in the region of $20,000 or so. Louisiana income tax will be in the region of $4500 or so. US social security taxes (similar to NI) will be between $7000 and $7650 (I don't
have the 2006 upper limit chart in front of me, just the 2005).
Because the US system is not as precise as the UK system, everybody files a tax return and everybody gets money back or owes on their Federal and state income taxes. Thus, the amount withheld from your pay will not be the accurate amount of tax you owe. To over-withhold so that you do not owe additional tax at the end of the year, you should consider filing Form W7 with zero exemptions. If you are married, you should consider checking the box labeled "married but withhold at the higher single rate". Approximately 75% of people who file get a refund; this is one of the tricks that leads to a refund.
If you have a lot of unit trusts or investment trusts (even ones in ISAs) or any other tax-advantaged investments, you should seek expert council before you move. You should also seek council if your own your own home and are planning to sell it after you move.
lizzit · 9 years ago