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!
Hi!
I am single and have 1 job. Before I have claimed 0 and it seems like way more taxes are coming out of my paycheck than necessary. However, I do not want to be responsible for owing money at tax time. I’d rather get a refund. What would be my best option?
Thank you 🙂
Hi Crystal,
I suggest claiming one as single with one job.
The general rule is that the more allowances you claim, the less withholding you’ll have taken out of your paycheck. If you claim zero, you’ll have the maximum amount taken out. If you claim a large number, you’ll have less taken out. The absolute ideal scenario is to have your tax liability (or refund) at the end of the year be as close to zero as possible.
Hello.. I am single and I accidently was claiming 3 for about 6 months if I corrected to 1 will it be a problem
Hi Yesenia,
I suggest updating it as soon as possible with your pay roll department and it will take effect for the following pay period. It should not create too much of a problem for your. Just be aware that you may not be receiving much of a refund this year.
I have two kids and single i claim both on my w-4 but my exemption saying 7 what does that means? Are they taking more out my paycheck or no.
Hi Dominique,
Based on the information that you have provided, it sounds like your pay roll department has made a mistake with their withholding. I suggest checking with them and possibly updating your W4 form with them (which you can do at anytime throughout employment).
I’m also having the same problem.. I’m a single mom with two kids under the age of 17..Recently I found out that on my check it says 7 allowonces and no federal tax was being taking out my check for the past two months.Although my first two paycheck federal tax was being taking out will i have to payback the irs some money for the two months no federal was being taking out? If so what can I do to change this?? Please reply back asap
Hi Vanessa,
I strongly suggest checking with your pay roll department to make sure that your W-4 was filled out correctly.
Hi, I am married, we file jointly, and we both claim 1. I am the head of the house hold regarding income. Can I claim more without owing at the end of the year?
Hi Christine,
The general rule is that the more allowances you claim, the less withholding you’ll have taken out of your paycheck. If you claim zero, you’ll have the maximum amount taken out. If you claim a large number, you’ll have less taken out. The absolute ideal scenario is to have your tax liability (or refund) at the end of the year be as close to zero as possible.
I also suggest taking a look at the IRS Withholding Calculator. It only takes a few minutes to complete and will give you the most accurate amount of allowances to claim in order to reach that break-even point at the end of the tax year.
Hello,
Currently I am single and claiming 1 and I was thinking about changing it to 2. I tried the calculator but i didn’t understand it completely
I would really appreciate if some one could advice me if changing my claim status to 2 would help or not and what are the chances that I might owe to IRS at the end of the year after changing the status.
Hi Parth,
I would suggest claiming one as single with one job. However, take a look at a copy of the W-4 form. There may be a situation where claiming two would make sense. For example, are you filing as head of household? This allows for another allowance.