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 just started a new job and am a little confused as to fill out my W-4. I am married to a non-working spouse and i have two children. Im looking to get the most out of my weekly paychecks now, and deal with whatever may come once tax season arrives. What is the best way to do this?
Hi Justin,
Congrats on the new job!
When completing your W-4 form, you can have it reflect your financial situation. For example, if you prefer to see the most out of your paychecks throughout the year instead of receiving a refund after filing, then your best bet would be to fill out the personal allowances worksheet on the W-4 form and claim the amount calculated. Keep in mind that the worksheet will calculate the highest amount that you should be claiming. This could result in you owing the IRS at the end of the tax year.
On the other hand, if you would prefer to pay your taxes throughout the year and either break even or possibly receive a refund after filing, then you should claim a low amount of allowances on your W-4. (For example, claiming zero allowances allows for the maximum amount of taxes to be withheld from your paycheck to cover taxes) If too much is withheld throughout the year, a refund will be issued.
Hello,
I’m married with two children, we file jointly, and recently received a new position and higher pay at my job. I currently have my medical premium that covers all of us deducted from my paycheck. Needless to say I have a lot of deductions on my paycheck.
I am not concerned with a refund and instead need to take home as much money as possible. I itemize and have several write offs on my tax returns which decreases our tax liability significantly . I would like to claim the maximum number off allowances, which I believe is 9. Even if I owed at the end of the year, this would allow me to save over the course of the year for it.
Is this an advisable situation? Can you offer your two cents?
-Derek
Hi Derek,
If you would like to receive more throughout the year from your paychecks, then you have exactly the right idea. You’ll want to claim the maximum number of allowances on your W-4. Typically, people don’t have the willpower to save throughout the year or just would like a large refund at the end of the year instead of owing so they will claim a low number of allowances. The good thing about your W-4 is that you have the choice of how you will pay your taxes.
In order to calculate the maximum amount that you can claim, you have two options:
1. Complete the Personal Allowances Worksheet of your W-4 form. The numbers on each line will be added together and reported on line H and then ultimately on line 5. (Keep in mind that this is for your records and only the bottom portion is kept on record by your employer.)
2. Use the IRS’ Withholding Calculator tool. This will have you answer specific questions about your tax situation and will calculate the amount of allowances for you.
Both option #1 and #2 should come out to about the same amount.
I am single and have a baby girl and claiming her and myself in my w-4 is this a good idea? should i have just claimed 1?
Hi Eddie,
Being as you are single with one dependent child, I would suggest claiming 2 allowances. However, if you prefer to receive a larger refund come tax time, you can claim 1 allowance instead.
I’m curious about filing my w-4. I just started a new job. I am head of house hold. I have a new born, and I am single but my girlfriend I also claim as a dependent because she does not work. I get paid weekly and had almost $250 a week taken out, but I claimed 0 on w4. So should I claim 3?
Hi Chris,
Congratulations on the new baby and job!
When completing your W-4 form, you want to do what is most financially beneficial to you. In your case, with a new addition to care for, you may need and appreciate a few extra bucks each pay period. Since you are claiming zero allowances right now, you are then seeing that a large chunk of your paycheck is going to taxes. That is simply because by claiming zero, you are allowing the maximum amount to be withheld to cover the taxes due throughout the year. I would suggest raising the amount of allowances you’re claiming to 2 or possibly 3. This will provide you with more each paycheck and still possibly allow for you to see a refund after filing as well.
Good afternoon.
I am about to start a new job, for much less money than I was making before. I need all the money I can get, but I also want to be able to get a refund next year.
On A I enter 1 for myself, but I am confused if i should also enter 1 in section B and E. That would make my allowances 3, and would that not make it so that I will not get a refund?
I guess I’m looking for a good middle ground. I don’t want a lot take out in my withholding, but I do want a refund next year.
Can you help?
Nuria
Hi Nuria,
You were smart to ask for help seeing as the W-4 form worksheet should really only be used as a rough guideline. The amount you calculate by filling it out is the highest number of allowances that can be claimed. This does not mean that it is giving you the amount that will get you the highest refund. It is simply the highest amount you can claim based on your current situation. That being said, there is no magic number that can be claimed on your W-4 since when you actually file your taxes, the refund or amount due is based on so many other factors.
I’m not quite sure of your specific circumstances based on the information provided above but if you are single with no dependents, claiming zero or one allowance is the most common. This will allow an adequate amount of taxes to be withheld from each paycheck and most likely will result in a refund after filing your return.