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 would really appreciate some advise.
I am married and recently had a baby. Currently I work part time and my husband works full time. How should my husband and I file our employee tax information?
Hi Muriel,
Congratulations on the latest addition to your family!
Based on the information you have provided above (and assuming you will be filing a joint tax return), it would be most beneficial for you to each claim one allowance on your W-4 form. The spouse earning the higher income should claim an additional allowance for your dependent child. This will be most beneficial to you and your husband financially.
I am a single independent with 2 jobs. I make more at one job than the other. What should I claim on both of my W-4’s?
Hi Lili,
The IRS suggests having all tax withheld (all allowances) at one job and providing all other employers with W-4s that will result in no withholding (zero allowances). In your case, it would be safer to claim the majority of your allowances for the higher paying job since there is no penalty for overpaying taxes. If you end up overpaying, you will receive the difference as a refund from the IRS after filing your tax return.
Hi! So I am have to turn in my W-4 soon but wanted to ask on how to fill it out. If I add up the lines it’s 5. That seems like a lot but when answering the questions looks right. I am single and have 2 kids. It says to enter “1” for myself if no one can claim me as a dependent so there’s 1. Then enter “1” if I am single and have 1 job so that’s another. Then I skip to my dependents which is 2 for my kids, then another for head of household that’s 5. Is it right?
Hi Cristal,
Although five allowances seems like a high amount to claim, you will be receiving tax benefits based on the information provided above. You are credited a certain amount by claiming head of household along with the child tax credit and dependents. The one suggestion I would take is lowering the allowances to four instead of five by claiming only one for yourself.
I am single, one job, no dependents, moving from 1099 to W-2 employee. What’s best for me? And what’s best for the employer? He’s suggesting I claim two. Doesn’t seem to make sense.
Hi Chris,
As single with one source of income, it is most common to claim one allowance on your W-4 form. The more allowances you claim, the less is withheld from your paychecks to cover taxes that you are liable for. The less allowances you claim, the more is withheld. You will receive a refund from the IRS when too much income is withheld from your paychecks for taxes. If too little is withheld, you will end up owing the IRS instead. Your employer probably suggested claiming two allowances so that you would have more take-home pay each pay period.
I am married and my wife and I both have jobs. We live in New York City. I am starting a new job this year.
I think I have normally put 0 for allowances. We are expecting our first child at the end of April.
Should I put 0 allowances again or put 2 this time?
Thanks.
Hi Jeff,
Congrats on the new job and new addition to the family!
Since you are experiencing a few changes that are bound to affect your tax situation, it is important that you update your W-4 form to reflect that. A good rule of thumb to follow when completing your W-4 form is to claim one allowance for yourself and an additional allowance for each dependent you plan to claim on your tax return. Since you are most likely filing a joint return with your wife, the spouse with the higher income should claim the additional allowance (totaling 2) on their W-4 form.