What Is the Minimum Amount of Earnings Before Paying Federal Taxes?

by Donald Baggarly ; Updated September 11, 2015
Different types of federal taxes have differing rules regarding the amount of income that can be levied for taxes.

The federal government levies three types of taxes on payroll earnings. These include federal income tax withholding, Social Security and Medicare. Each tax has a different rate for withholding and each has different rules and regulations regarding the maximum. Only the federal income tax has a minimum amount of income before owing taxes at the end of the year.


Medicare taxes are split 50/50 between an employee and an employer. Medicare is taxed at 2.9 percent, or 1.45 percent each for the employee and employer. Those who are self employed or independent contractors will be responsible for the whole 2.9 percent. This tax is levied on all income and is not subject to a minimum or maximum income.

Additional Medicare Tax

In 2013, there is an Additional Medicare Tax of .9% which will be withheld from paychecks of employees earning more than $200,000 per year. The tax will be paid at the end of the year on the income tax returns for taxpayers over a certain threshold, based upon filing status. The thresholds are $250,000 for married filing jointly filers ($125,000 for married filing separately) and $200,000 for single, head of household, and qualifying widow(er) filers.

Social Security

Social Security taxes are split 50/50 between an employer and employee. The total tax levied on income for Social Security is 12.4 percent of income for the first $113,700 earned in a calendar year. This is based on the 2013 figures from the IRS; 6.2 percent will be paid by the employee and 6.2 percent is to be paid by the employer. Those who are self employed or work as an independent contractor will be responsible for the complete 12.4 percent due to the government. This tax is levied beginning with the first earned dollar of the calendar year.

Federal Income Tax

The minimum amount of earnings before having to end up paying taxes will depend on your specific situation. For example, a single person with no children who will be filing tax returns in 2013 for calendar year 2012 can make up to $9,750 without paying any income taxes. This is because the IRS allows a single person in 2012 an automatic exemption of $3,800 and a standard deduction of $5,950. A married couple filing jointly with no children would be able to make up to $19,500 before having to pay federal income tax. This is because an automatic exemption of $7,600 is allowed in addition to the $11,900 standard deduction.

How Taxes Are Paid to Government

Throughout the year your federal income tax payroll deduction can be adjusted to take out more or less taxes depending on your certain situation. This can be done by submitting a change to your W-4 form to claim more dependents or by adding extra to be taken out in addition to the calculated amount. If too much is paid to the government through your withholdings, then a refund will be issued by the government. However, if too little is paid then you will owe the government the difference between what was paid and what is owed. Social Security and Medicare taxes cannot be adjusted, and the exact amount owed for the income earned will be taken out on each pay day. For those self employed or classified as an independent contractor, taxes are due quarterly and are paid directly to the government.

About the Author

Donald Baggarly began writing professionally in 2010. He works with individuals and families to promote sound and realistic personal budgets and has a full-time job in the staffing industry consulting small- and medium-sized businesses. Baggarly holds a Bachelor of Arts in economics and management from Beloit College and a Master of Business Administration in accounting from University of Phoenix.

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