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!
Hi,
I just started working in May of last year, I am a single mother of 1 child under the age of 3 (doesn’t attend school yet) I worked 2 jobs until this past February, made a little over 22,000 but less than 23,000 with both jobs combined, I put A)1, D)1, E)1, F)1, and G)2. to a total of 6 on letter H, I have not done my taxes yet, but from this so far, will I be getting anything back at all?????
Hi Mischelle,
I suggest claiming two exemptions. Six is too large of a number and could result in you having tax due rather than a tax refund when filing your taxes.
Hi, my husband and I have our taxes done by someone else and were just told we owe $2100.
We are shocked. We want to change our withholdings so we don’t owe at end of year.
We file jointly
No kids
Both have a 401k
2 employers for me
1 employer for him, HOH
Together for 2014 we should net 150,000
Should I have filled out the “multiple earners” worksheet? And if so do I fill out two(one for each employer)? Are they filled out identically?
Should I have checked box for “married, at higher single rate” instead of “married”?
I keep reading that regardless of the number of jobs I have I should fill out one w-4. So why is
each employer asking for one?
Thanks in advance, E
Hi Elissa,
You should each claim 1 on your W-4. For your second job, you should claim 0. With these changes, you will be having close to the maximum amount withheld from your pay and ultimately, you will not owe in tax year next year when filing and might even receive a refund.
What should i be claiming on my W-4’s. Currently i claim Single with 1 allowance and my wife claims 0. and we received a large tax return this year but i want to receive a larger paycheck instead of a large return without paying in. We also have 3 children.
thanks,
Hi Chris,
Basically, the lower number you claim on your W-4 means a higher tax refund when filing your taxes and opposite is true for the higher number you claim. It’s good to know however, the lower number you claim does also mean the higher amount in taxes that will be taken out each pay period while claiming a higher number means less taxes being taken out each pay period.
If you have 3 children that you claim, you can claim 4 on your W-4 and you should be fine when filing your taxes.
I’ve been wondering on my w2 I claimed 3 ( me and two kids) come to find out their dad claimed them, now will I owe cause I will not be claiming them?
Hi Keeley,
If you are eligible to claim the children, you should, regardless. If you aren’t eligible to claim them, you might have tax due because you over claimed exemptions on your W-4.
In this situation, to avoid tax due, as this article says, you will have to file a paper return to the IRS, by mail. That means you’ll mail your return to the IRS. Also, you will have to include a cover letter explaining your situation and evidence proving you have the right to claim your child.
After the IRS receives your mailed return, cover letter and evidence, they will review to see who deserves to claim the dependent. If two people have the right to claim a dependent, IRS will generally award the dependent to the person with whom the dependent lived for the greatest amount of time during the tax year.
To help, when you send the return, evidence and cover letter to the IRS, be sure to prove and explain you meet the requirements to claim the dependent.
Hello,
I made a mistake when filling out my W4 when I first got hired. Somehow I put 4 dependents. Now when i was filling my W2 my refund is not as previous years. I am a single mother of one which I claim. How can I fill out my W4 that I dont make the same mistake all over again? Also, is there anyting I can do about my mistake? as far as filling out a form stating that 4 dependents was a mistake?
Thank you so much.
Hi Janeth,
Since you accidentally claimed four, that means you had less in taxes taken out each week, which ultimately means your refund is lower when filing your taxes. There is nothing you can do to fix it other than change your W-4 as soon as possible. I would ask your employer to change your W-4 to one or two.
If you are claiming your child, claiming one or two will still result in a refund. The best option is to probably claim two.