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!
I claim 1 on both Federal and State. I am married, but filed separately last year. We do live together. My only income is my job, and then my husband’s only income is his job. He prefers to get a big refund at the end of the year. However, when I do a quick calculation based on my last paycheck with a tool on H&R block and I may owe almost $4K. This is enormous and I don’t understand! Should I revise my claims to just be 1 for Federal and 0 for state?
This should not be the issue as to why you would be owing money to the IRS the estimated tax liability that you figured out. The number of allowances that you claimed would mean that you had more taxes withheld throughout the year and less of your income received.
The rule of thumb is, the more allowances claim, the more income you receive back during the year, but it becomes more likely that you will end up owing.
The fewer allowances taken, the less income received back, and you end up having more taxes withheld from your paycheck throughout the year.
Hello,
I am starting a new job in January and I am debating if I should put 0, as I always have, or change it to 1. I do understand that with 0 I’ve had a greater amount been withheld every check and I have always received a refund. But I am not sure if I should now change it or keep it?
Another thing, I am getting married at the end of January as well. So should I be changing it to 2 then? or keep it 1? Should my then husband also change it to 2 or keep it as 1? We still haven’t decided if we will file together on 2019.
Thanks in advance!!!!!
You can use the IRS with holding calculator to help you determine how many allowances you should claim on your W-4 Form. Click here to try the IRS Withholding Calculator.
Hi! I am a single woman with no dependents, I am not head of household, but i switched jobs this year. Do I put 1 in B. enter 1 if you are single and only have one job?
Also, do i fill out the Two-Earns/Multiple Jobs Worksheet?
The IRS has a tool to help you determine how many allowances you should claim on your W-4 Form. Simply click here to use the IRS Withholding Calculator.
I’ve been filing zero my entire life (I’m 34) because my dad suggested it when I was younger. Then I read something the other day saying getting a refund isn’t necessarily a good thing, so I’d like to finally make a change.
I’m married, filing head of household, husband was out of work this year, 2 kids. Should I claim 4? I also do not want to owe the IRS but I’m okay with not having the huge refund if I can get more in my paychecks. I feel like I’ve been screwing myself this whole time by filing zero…
Also, WHEN should I make the switch? Right away? Wait until after the new tax law goes into effect? Help please! Thanks for your diligence on this post and helping those of us who are tax illiterate. 😉
Generally, you want to be as close to zero when it comes to receiving a refund or having a tax liability. The closer you can get to zero, the more income you are able to use for the year, instead of receiving it as a lump sum to be used next year. This does not take into account any credits that may be applied to your tax situation, which is additional government assistance money that is given to you depending on your financial situation. From your outlined situation, filing for 4 allowances would be for the best.
Hi,
Both my wife and I claim one on the allowance. We have one child and or combine income is around $160k. We do not have a home and most likely use the standard deduction. Will we have to pay more tax at year end? I plugged in the numbers and seem like we might have to pay couple thousands more at year end.
Thanks
You can use the IRS with holding calculator to help you determine how many allowances you should claim on your W-4 Form. Click here to try the IRS Withholding Calculator.