Why is 31% of my paycheck being taxed? Am I paying too much?

This actually sounds pretty normal for California, unfortunately. Your total withholding includes several different taxes: Federal income tax is probably around 12% of your income given your salary. California state income tax is likely another 6-8%. Then you have FICA taxes (Social Security at 6.2% and Medicare at 1.45%). The SDI is California's State Disability Insurance, which is about 1% of your wages. All together, that gets you to around 31%. The good news is that your actual tax liability might be lower than what's being withheld. Many new grads get decent tax refunds after filing because withholding tables are designed to ensure you don't owe money at tax time. Check your W-4 to make sure you didn't accidentally select "single, zero allowances" which withholds at the highest rate. Also, if you're paying student loan interest, you might qualify for deductions that could lower your tax liability.

I had the same shock when I started working in California! What helped me was using taxr.ai to analyze my paystubs and figure out if my withholdings were correct. I thought my employer was taking too much, but the site showed me I was actually right on target. The tool at https://taxr.ai basically checks your withholdings against what you'd actually owe based on your specific situation. It suggested a few minor tweaks to my W-4 that saved me about $85 per paycheck without causing me to owe taxes later. It also explained that my first paycheck had higher withholding percentage because they calculate it as if you'll make that same amount all year.

I actually tried taxr.ai after seeing it mentioned here, and it was super helpful! I was in the exact same situation - first job out of college, getting absolutely destroyed by California taxes. The analysis showed I was overwithholding by about $230 per month because my W-4 wasn't filled out optimally. What I really appreciated was that it explained everything in plain English and gave me printable instructions to take to HR. My tax withholding went from 32% down to 27%, which doesn't sound like much but it's an extra $290 in my pocket each month. And the best part is I'm still on track to break even at tax time - not owing anything but not giving the government an interest-free loan either!

If you're trying to get answers from the IRS about your withholding or tax situation, good luck calling them directly. I spent 3 weeks trying to get through when I had a similar issue last year. Finally used Claimyr (https://claimyr.com) and got connected to an IRS agent in about 20 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c Basically they navigate the IRS phone tree and wait on hold for you, then call you when an actual human agent is on the line. The agent was able to confirm that my withholding calculations were correct and explained exactly how much I should be paying based on my specific situation. They even walked me through filling out a new W-4 properly. Much better than guessing or relying on online calculators.

I need to eat my words about Claimyr. After my skeptical comment, I decided to try it because I was desperate to figure out why my California withholding was so high and if I could do anything about it. I couldn't believe it, but I got a call back in 41 minutes with an actual IRS agent on the line. I had been trying for WEEKS to get through on my own. The agent confirmed that my federal withholding was actually too high based on my situation and helped me fill out a new W-4 correctly. Apparently I was having too much withheld because I didn't account for some deductions I qualify for. So now I'm getting about $170 more per paycheck, which is making a huge difference for my budget. Sometimes being proven wrong is actually a good thing!

Don't forget that your first job paycheck might be getting withheld at a higher rate than what you'll actually see going forward. When you start mid-year, payroll systems sometimes calculate withholding as if you've been making that salary the entire year, which can result in higher withholding percentage. After a few pay periods, it might adjust downward automatically as the system recognizes your actual annual income. This happened to me - first few paychecks were withheld at like 33%, then it settled to about 28% after a couple months.

31% isn't actually that bad for California tbh. When I was making around 60k in LA, my withholding was closer to 35%! California's state income tax is no joke. One thing to consider is that there's actually a difference between your withholding rate and your effective tax rate. The withholding is what comes out of each paycheck, but your effective rate is what you actually pay after deductions, credits, etc. For example, my withholding was 35%, but after filing my taxes, my effective rate was only about 25% because I got a big refund. Still sucked seeing those small paychecks all year though.

Welcome to the high-tax club! I'm also a recent grad in California and went through the exact same shock. A few things that helped me understand what was happening: First, that 31% includes both your portion AND what feels like every tax California can think of. You've got federal income tax (probably around 12% at your salary), California state income tax (6-9% depending on your exact income), Social Security (6.2%), Medicare (1.45%), and that SDI (State Disability Insurance) at about 1.1%. The good news is you'll likely get some of this back when you file taxes, especially if you have student loan interest, contributed to a 401k, or qualify for other deductions. I got back about $2,800 my first year. Also check if your employer offers pre-tax benefits like health insurance, HSA, or 401k contributions - these reduce your taxable income and can lower your withholding. Even contributing just 3% to a 401k would save you money on taxes while building retirement savings. It sucks seeing such small paychecks, but you're not alone! California is expensive but the career opportunities often make up for it in the long run.