Filling out a W-4 is less mind-boggling than you think.
One of the first things you have to do when you get a new job is filling out a Form W-4 [Employee’s Withholding Allowance Certificate]. It is essential to complete a W-4 correctly because it determines how much tax will be withheld from your pay and how large your tax refund will be.
The first half of the form is pretty easy. You just have to fill in your name, address, and marital status.
Then you have to figure out how many allowances to claim. This number will determine the amount of your withholding.
Number of allowances to claim
Generally, the number of allowances you should claim will correspond to the number of personal and dependency exemptions you can claim on your tax return, but this is not always the case. Claiming zero allowances will result in the maximum amount of tax withheld. Every additional allowance you claim on top of that means that a little less tax is withheld.
You’re a Dependent:
If you can be claimed as a dependent on someone else’s tax return (ie: your parent’s, aunt’s, etc.), you should claim zero allowances. When you’re a dependent, the person who claims you get the benefit of your personal exemption and you, yourself, will end up owing slightly more in taxes. Hence, the tax should be withheld at the maximum rate of zero allowances.
You are Single:
As a single taxpayer, your W-4 form is straightforward enough but you do have several options when it comes to claiming allowances.
- If you’re single with one job, the allowances to exemptions ratio don’t exactly hold true. Most single people claim one allowance. However, this is likely to result in a refund. If you prefer the extra money after filing, then claiming one allowance is the choice for you.
- Claiming two allowances would get you closer to your exact tax liability, but may actually result in some tax due. That being said, you would have more take-home pay throughout the year since your employer wouldn’t be withholding as much tax from your paychecks.
Essentially you can choose whether to claim one or two, depending on the rest of your tax situation, but it’s probably safer to claim one.
You are Married:
Have you tied the knot? This can drastically change your tax situation. Don’t worry; it’s typically for the better. Being married opens up a few doors for you when it comes to tax benefits. You can now file a joint tax return. This is the absolute ideal filing status in regards to taking advantage of your benefits as a taxpayer. In most cases, being married also allows you to claim more allowances on your W-4.
- If you are married with no children, you should claim two allowances.
- If you are married with one child*, you should claim three allowances.
- If you are married with two children*, you should claim four allowances.
Other Situations:
Things get a little more complicated if you have multiple jobs, your spouse works, or you intend to itemize your deductions. In these cases you should turn your attention to page two of the W-4:
- Deductions and Adjustments Worksheet: Use this worksheet if you plan to itemize deductions on your tax return or claim adjustments to your income.
- Two-Earners/Multiple Jobs Worksheet: You will be directed to use this worksheet from the Personal Allowances Worksheet, line h. It is only necessary if you are married and earning a combined income of over $20,000 or if you are single with two jobs earning over $50,000.
The IRS also has a withholding calculator on their website that can give you a second opinion on how many allowances to claim.
The last thing you need to do is figure out if you are exempt from withholding. For most, this is not the case. Essentially, you are only exempt from withholding if all of the following is true:
- you aren’t a dependent,
- you had the right to a refund of all income tax withheld last year, and
- you are not required to file a return this year.
If you are exempt, you can write exempt in line seven. You’re done! All you have to do now is sign the form and hand it over to your employer.
Update Your W-4 For A Larger Refund or More in Your Paycheck
Even if you’ve been at your job for a while, it’s a good idea to monitor and, if necessary, update your W-4 every year. This is especially true if there’s been a major event in your life such as a marriage or the birth of a child.
The goal is to get your refund or tax due as close to $0 as possible. Getting a big refund when you file taxes is a great feeling. It can also trigger that your withholding needs to be adjusted. The reality is that you could be enjoying that money throughout the year instead of having it withheld from your paychecks.
Regardless, during tax season you’ll need to report the total earnings and tax withheld on a tax return. Use RapidTax to file your taxes without a hassle and receive the maximum refund possible!
Hello. I am so confused about this w4 form. My husband and I got married on March of 2013. We had one child before marriage that he claimed for 2012 taxes. I had a business that was sold on Nov of 2013. We also had another child on December of 2013. My question is: do we file joint tax returns for 2013 and he needs to submit new w4 for the 2014 tax year…does he claim all 4 of us since I don’t plan on working again until later on this year and then we should split the exemption when I fill out the w4 with a new job? Also, my 60 year old mother lives with us. Do we have to claim her as well? We would like to not owe any taxes at the end of the year!
Hi there,
Yes, you can file jointly for 2013 (because you were married in 2013). Also, claiming 4 is correct, and just like you stated you will split the exemptions on your W-4 when you start a new job.
Regarding your mother, you and your husband can claim her as a qualifying relative dependent if the following requirements are met;
-She earns less than the personal exemption amount during the year. For 2013, this means she earned less than $3,900.
-You and your husband provides more than half of the dependent’s total support during the year.
-If your mother is married, she cannot file a joint return with her spouse.
-Your mother must be a citizen or resident alien of the United States, Canada, or Mexico.
hello I am married and claim 1. my husband claims zero . the last few years we have owed a couple thousand dollars. I am just starting a new job and am completing my W4. would I mark EXEMPT? I do itemized due to medical expensrs and home ownership please help.thank you
Hi Kelly,
Do you have any other sources of income other than those reported on a W-2? If not, are you and your husband subject to the Alternative Minimum Tax (AMT)? If you are answering yes to either question, it could explain why you have tax due.
On your new W-4, it would be best to claim 0 (or 1). If you claim exempt on your W-4, the employer won’t withhold anything for federal taxes and state taxes. Legally, you are only allowed to claim exempt if you have the right to have all your taxes refunded.
In 2013 I worked part-time from Oct to Dec, had taxes taken out of my unemployment and I am currently a college student. I put a 3 under exemption for my W-4. I only have 1 dependent and myself (no one can claim me). I will not be claiming head of household. Will I owe any taxes?
I also just noticed that their were no Federal income taxes taken out of my check.
Hi Veronica,
You will probably have to pay taxes. I suggest changing your W-4 to 2.
If I claim head of house or have another dependent will that help me avoid paying?
I am filling out my W-4 form for a part time job I started last month. I am single with one child. Do I write 1 on line 5? And write exempt on line 7? I want the most I can get for a refund. Thank you!
Hi Mandy,
If you are claiming your child, I would claim a total of one or two. To receive a larger refund, claim one.
I have a quick question about one of my wife’s w-2 forms we received. My wife claims 0 and made just over $9k for the year at this job. The employer only took out $42 for federal withholdings. When contacting the employer, they confirmed that 0 is claimed on the w-4. If claiming 0, why would they only withhold $42 and not more?