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!
My question is:
I am married with an average income of $45,000. I have no dependents and I own a home, as well as my husband. He wants to file separately. What should I claim in order not to have to pay taxes?
Hi Irene,
Regardless of how you fill out your W-4 form, you will be paying the same amount of taxes to the IRS. It will be more about when you pay these taxes which your allowances affect. The more allowances you claim, the less is withheld from your paychecks to cover taxes owed. The less allowances you claim, the more is withheld. If too little is withheld throughout the year, then you will have a tax bill with the IRS. If too much is withheld, then the IRS will issue you a refund after filing your tax return. If you prefer to not owe the IRS after filing, then I suggest claiming zero allowances on your W-4 form.
Hi!
W-4 question… 2015 taxes were filed married, joint.
Will be divorcing in 2016. My 3 children will be living with me. Do I change my W-4 to head of household with Zero allowances?
I would rather be taxed during the year & receive refund later!
Thanks..
Hi JoMarie,
Since you know you will be altering your tax situation this year, it would be in your best interest to update your W-4 to reflect this. Your filing status for the entire year is your filing status on the last day of that year. That being said, claim on your W-4 whichever filing status you plan to file your actual tax return as (head of household in your case).
When it comes to claiming allowances, you can always claim less than allowed. Claiming zero will allow for the maximum amount to be withheld from your paychecks. If you prefer to have a higher refund and more withheld throughout the year, then claiming zero allowances is your best bet.
I am a single mom with 2 children (15 and 17). I work 2 jobs which makes my income about $84,000. I am not sure how many allowances I should claim on my taxes. I usually claim 4 for both jobs. I am getting a refund each year but want to have more take home pay. I want my tax liability as close to $0 as possible without owing. Do you suggest I should increase my allowances? If so, I do I calculate this number?
Hi Tiffany,
Increasing your allowances is not a bad idea if you continuously receive a decent refund after filing your taxes each year. I suggest increasing your allowances to five and then observing the difference in your paychecks. You should be seeing more income in each paycheck (and a decrease in federal withholding). You can update your W-4 as you see it necessary. That being said, if you feel that too little or too much is being withheld, you can change your allowances and it will go into effect immediately for the next pay period.
Hello,
I have a W-4 question. I just got a new job and I’m not sure how to fill out my W-4. I am single with one job. I have a daughter but my Boyfriend will claim my daughter in his taxes next year, so I cant claim her in my taxes, because from what I understand from taxes, only one of us can claim her. My question is, should I fill out the W-4 as single with 1 allowance or 2 allowances? The first line says put 1 if you are single and second line says put 1 if your single and have one job, so do I put one for both lines? At the bottom, it says to add up all the sections above and that would be those two lines and if I add it up it would be 2 allowances.
Hi Yamile,
When using the Personal Allowances Worksheet, it is important to know that this will assist in calculating the most allowances you can claim on your W-4 based on IRS rules. You can always claim less though. The higher amount of allowances you claim, the less will be withheld from your paychecks to cover your tax liability. The less allowances claimed, the more is withheld from your paychecks. You receive a refund if too much of your income is withheld over the tax year. You receive a tax bill if too little is withheld. The IRS gives you the leeway to a certain extent to choose which you prefer. Either way, it is the same amount of tax being paid.
If you claim two allowances, less will be withheld over the year which leaves you with more take home pay (but possibly a tax bill/less of a refund). If you claim one allowance, you will have more withheld from your paychecks (but possibly a bigger refund/less tax due). You also have the option to claim zero allowances. This will allow for the maximum to be withheld from your income and the least tax due after filing your tax return.
I just started a new job, they are asking what I want to claim on my w-4. My husband claims Me and my 2 kids…16 & 20. I was going to put down 3. Not sure if that is correct.
Hi Michelle,
A good rule of thumb is to claim one for yourself (if you are now going to claim yourself on your tax return) and an additional allowance for each dependent you plan to claim on your tax return. You can always claim less. The more allowances you claim, the less will be withheld from your paychecks to cover tax. The less allowances you claim, the more will be withheld from your paychecks to cover taxes. If too little is withheld to cover taxes, then you will owe the IRS after filing. If too much is withheld to cover taxes, then a refund is issued to you after filing for the year.