The last thing you want to do is frantically run up to your boss asking “How many allowances do I claim on my W-4?”.
Being aware of the number of allowances you are claiming on a Form W-4 [Employee’s Withholding Allowance Certificate] is important for a variety of reasons. Most importantly, the number of allowances you claim on a W-4 determines the following;
- how much tax will be taken from your income (aka the withholding amount)
- the size of your tax refund
Steps to filling out a W-4
You’ll need to follow four simple steps when filling out your W-4 Form:
- Fill out your personal information (Name, Date of Birth, Address, Marital Status)
- Know the number of personal and dependency exemptions you are claiming on your tax return.
- Based on the number from step 2, use that number to help determine your number of allowances.
- Don’t forget to sign the W-4 and turn it into your employer!
The allowances you claim while filling out a W-4 if you are single will differ from the allowances you claim if you are married or have kids.
Claiming zero allowances
- The maximum amount of tax is withheld. Meaning, when it comes time to file your tax return you will most likely receive a refund.
- You’re being claimed as a dependent on someone else’s tax return.
Claiming one allowance (ideal if you are single with one job)
- You’re single and have one job. Claiming one allowance will most likely result in a refund when you file your taxes.
Claiming two allowances
- You are single. Claiming two allowances will get you close to your tax liability but may result in tax due when filing your taxes.
- You’re single and work more than one job. Claim one allowance at each job or two allowances at one job and zero at the other.
- You’re married.
Claiming three allowances
- You are married with one child.
Claiming additional allowances
- File as head of household if you are eligible. You are able to claim additional allowances.
- You had at least $2,000 of child or dependent care expenses that you plan on claiming credit
- You’re eligible to claim the Child Tax Credit
Can I fill out a new W-4 form?
Yes, employees can submit a new W-4 form to their employee at any time during their employment. Have you recently started a second job, had a baby, or tied the knot? Life changes such as these should encourage you to update your W-4 withholding.
A great tool to help you while filling out a W-4 is the IRS Withholding Calculator, located on the IRS website.
Claiming zero allowances means less take home pay, but a bigger tax refund during tax season.
The number you report on a W-4 will ultimately determine your take home pay and your tax refund. Don’t write down any number. Take the few extra minutes to really assess your situation and fill in the W-4 accordingly. By doing so you’re less likely find yourself in a difficult financial situation.
Then, when you’re ready to file your taxes, you’ll have a heads up on whether or not you’ll be receiving a tax refund!
Hello,
I’m married and have no kids. Me and my husband file taxes separately. I currently claim zero allowance, and it’s strange to me how much money is being taken out of my pay check, and I have to pay at least $1000 when doing my taxes and I make 45K. Should I change it to 1. Any suggestions what the best option for me would be? Thank you.
Hi Ana,
Claiming zero allowances means that your employer is withholding the maximum amount from your paychecks to cover taxes owed to the IRS. If you prefer to see more take-home pay, then I suggest claiming more allowances on your W-4. If you find that you are owing after filing your tax return for the year, you may want to double check with your employer that they have the correct information recorded from your W-4. Based on the information provided above, you should not be owing the IRS $1,000 with one source of income, filing separately and claiming zero allowances (unless there is another circumstance that you left out).
My wife just started a new job and i’m helping her fill out her w-4. we’ll be filing jointly since she’ll only be making under 10k. Going by the instructions, we have 3 kids and our income is under $100k I should be using 2 per eligible child (child tax credit) I plan to put her as 0 but does that mean i should be putting 6 on my own w-4?
Hi Brent,
It is important to know that when utilizing the personal allowances worksheet on your W-4, you are calculating the maximum amount of allowances you should be claiming based on IRS rules. This being said, the IRS states that you can always claim less allowances than you calculate using the personal allowances worksheet. The reason for this is because the worksheet tends to calculate a pretty high amount of allowances in cases where dependents are involved, etc. The more allowances you claim, the less is withheld from your paychecks to cover your tax liability. If too little is withheld, then you will end up with a tax bill after filing your return for the year. The less allowances that are claimed, the more income is withheld from your paychecks to go toward your tax liability. If an excess is withheld throughout the year, then the IRS will issue you a refund.
Hi there.
Question.My husband and I both work he works full time i work 2 part time jobs he makes much more money than me and we have one child with not many deductions.We just did our taxes and we owed federal back.(never happened before) Ok so we both claim 0 on our w-4,can you please tell me what we are doing wrong?Please tell me which to put on our W-4.
Thanks in advance!
Hi Michelle,
This could be occurring because your husband’s income amount is putting you both in a high tax bracket. Since you are both already claiming zero allowances, you can have an additional amount withheld as well (using page 2 of the W-4 form) and/or look into tax credits you may not already be claiming. The good thing about tax credits are that they decrease your tax dollar for dollar. Many taxpayers are not aware of tax credits that they could be claiming on their tax returns.
Thank you so much for your time! I’m looking into it now 🙂
Happy to help!
Hello there,
I got a job recently and first time to file W4. I am married with no kids. filing jointly. what should we put in my claim? 1, 0? I already filled 0, should I put 1 instead? what is the advantage and disadvantage of 0. Some says, when filing season comes, I may need to pay more because I didn’t claim any. husband is not working. I am making 2400 a month. Thank you very much! – theresa
Hi Theresa,
Congratulations on the new job!
When filling out your W-4, the more allowances you claim, the less will be withheld from your paychecks for taxes. The less allowances you claim, the more will be withheld for taxes. If too much is withheld, you will be issued a refund and if too little is withheld, you will owe the IRS. That being said, you have a bit of flexibility with your W-4 form. The IRS allows this because whether you claim high allowances or none, they will be receiving the same amount of tax money. It is more about when- after filing your tax return or little by little throughout the year.
Let’s take a look at your situation based on what you mentioned above. If you claim zero allowances, your employer will withheld the maximum amount allowed to apply toward IRS taxes. If you claim one allowance, then slightly less will be withheld and you will see more take home pay. In both situations, it is a low amount of allowances. I do not suggest claiming more than two allowances since it could result in owing the IRS after filing.
I am single person with one job who cannot be claimed as a dependent. I submitted a w-4 with 1 allowance because I can’t be claimed as a dependent, and one allowance as the head of household. For some reason I received a letter from the IRS stating “we believe you submitted an incorrect W-4, employee’s withholding allowance certificate, to your employer”. I don’t know why I would have received this letter.. Does anyone have any ideas on why the letter would have been received?
Hi Brandon,
This happens sometimes when the IRS takes a deeper look into an individual tax situation and questions how you filled out your W-4 form. It is the IRS’ way of letting you know that you are probably not having enough tax withheld from your paycheck. After a certain time frame, this letter will essentially update your W-4 claims internally and withhold from your paycheck as if you had claimed zero allowances. This means that the maximum amount of income allowed will be withheld from your paychecks to cover taxes owed. Now, as you should see on the letter sent to you, you can submit an updated W-4 (or one with your original information) along with documentation to prove you can and should be claiming the allowances that you are. If you would like to see a more in depth explanation to this form and why you may have received it, take a look at the IRS webpage designated for it HERE.