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 currently have a temporary job and feel like they are taking too much in federal and state taxes. I am single and just have this one temporary job that will end in a week or two . I currently have claimed one allowance if I put 2 allowances will it affect me?
Hi Katherine,
You can technically ask your employer to update your allowances at any time. Keep in mind that this change will only affect your withheld amount from the time you change it and on. It will not apply to paychecks prior to that update. Also, the more allowances you claim, the more money you will see in each paycheck. However, the more allowances you claim, the less of a refund you will receive at the end of the tax year (which may also increase your chance of even owing money).
Hi! Nice to see you are replying to these posts.
I’m married and both myself and my wife work. We have two children but expect to collectively make $170,000. How many allowances should we each claim? Does it matter how you allocate the allowances? I would assume not but just curious.
Hi Brandon,
I suggest taking a look at the IRS Withholding Calculator. This will only take a few minutes to complete. They ask you several specific questions that will provide you with the most appropriate number of allowances you should claim.
Keep in mind that the more allowances you claim, the more money you will see with each paycheck. However the less of a refund you will see at the end of the tax year (possibly with the chance of owing money).
I am married my wife does not work. I have 2 kids. I claim zero now they take a ton of taxes out my check and i recieve a large refund. I would like to have a little less taxes taken out but still recieve a fairly descent refund. How many should i claim?
Hi Matt,
Keep in mind that by claiming zero allowances, you are having the maximum amount withheld from each paycheck. This is also why you are receiving such a large refund as well. I would suggest claiming one or two allowances so that you will receive a slightly larger amount each paycheck and a slightly smaller refund.
Another place to refer to is the IRS Withholding Calculator. This will have you answer several questions and based on the information you enter, will provide you with the best scenario for your situation.
I was on unemployment last year and file taxes, owing zero with a decent refund, This year I am working and cannot figure out if I check exempt (no tax liability) on my W-4 or leave it as zero or claim something. I have one child and am a single head of household. I am in NY, btw.
You can claim two allowances. However, since you may be eligible for the child tax credit and you are claiming head of household, I suggest referring to the IRS Withholding Calculator.
I am in a similar situation. Single mom with one child, head of household, received unemployment for about 4 months (tax was deducted) and at some point things got really bad so I started receiving food stamps as well. How should I file my W-4 and G-4 (State Tax Form for GA). I just got hired for a great position that will pay really great but since I am buried in debt I will need to receive a decent paycheck without owing taxes at the end. Please, advise WHICH claims I should check. Telling me just the number of claims confuses me as I do not know which ones are better to be claimed. Also, I really don’t get the exempt part. I haven’t owed federal taxes. I owed a $18 state taxes but I paid that.
Oh, if it matters, I was unemployed the whole 2014 with my only income the unemployment until April and a $600 child support.
Hi Elly,
The general rule is that the more allowances you claim, the less withholding you’ll have taken out of your paycheck each pay period. By following the directions on the Personal Allowances Worksheet of your W-4 Form, you will calculate the maximum amount that you should claim. However, you can always claim less than that to ensure that enough will be withheld from each paycheck. If you claim zero, you’ll have the maximum amount withheld. If you claim a larger amount, you’ll have less withheld. 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.
In order to do this, I 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.
Hi,
I am married and have one fulltime job my wife doesn’t work, I am just confused between number of allowances from 2 and 3, can you please suggest me whether to claim 2 Allowances or 3?
Hi Avinash,
The ideal goal at the end of the tax year is to have a small refund or a small amount that you owe. Choosing the correct amount of allowances will help you to achieve this goal.
The more allowances you claim, the more money you will see in each paycheck. However, the less of a refund you will see at the end of the tax year (possibly with the chance of owing money). If you claim three allowances, you will have less money withheld from each paycheck so the amount will be higher than if you claimed two allowances. However, by claiming three allowances, you will receive less of a refund (or owe more money at the end of the tax year) than if you claimed two allowances.