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 ended up paying a lot of tax this yr at yr end. I am a mother of 1 (Child age:2yrs) and file jointly with my husband (making over a lil more than 100K) so totalling both our salaries around 160 k.
How should fill the number of allowances in order to not end up payin a lumpsone at the end of the yr.
Thanks,
Tina
Hi Tina,
Keep in mind that the higher the amount of allowances you claim, the less money that is withheld from each paycheck, however a smaller refund at the end of the tax year (and possibly a higher chance of owing money). For your specific situation, I suggest referring to the IRS Withholding Calculator. After answering several specific questions, it will provide you with amount of allowances and how you should file that would be the most beneficial to your situation.
hello. I am single and work one job full time (contract). I just recently got a part time job and need to file W4. How do i fill that out? Should i claim 2 for each job. I am single with no kids and live alone in apartment. i already claim myself for full time job so total amount of allowance is 2. Should i do the same for second job since its a part time?
Hi Kasey,
If you are single, claiming two allowances will get you close to your tax liability but may result in tax due when filing your taxes. If you are single and have one job, by claiming one allowance will most likely result in a refund when you file your taxes.
Hi!! Quick question!! I just filled out our W-4 to get more money in our checks and I wanted to see if it correct. My husband works full time and I am a stay home mom with 2 kids and one due in November. We file jointly and he is head of household. And we are about to buy our house this year. According to the paper work it says . . . 1 for him, 1 for married, have only one job, and your spouse dose not work, 1 for spouse, 2 for number of dependents, 1 for head of household and 3 for the child tax credit. We came up with 9. I do not want to end up paying taxes. Is that correct? Thank you!!
Hi Michelle,
For your situation, I would suggest referring to the IRS Withholding Calculator. This will ask you several questions to provide you with the amount of allowances to claim that will be most beneficial to you.
Hello!
I am currently in school but off for the summer and work two jobs, retail part time job and an internship. The complicated factor is I am in another state for my internship and it also asks for exemption for that state as well as my home state. I was advised to put exempt from withholdings on my W-4 for my internship but I don’t think my mother will claim me (I have been independent for a while) so should I still put allowances? Also for my part time job, I did put allowances. I’m just afraid that I will get penalized when I file for taxes.
Thanks a lot! I greatly appreciate it!
Hi Tiffany,
If you are single and work more than one job, you can claim one allowance at each job or two allowances at one job and zero at the other (assuming that you are getting paid for the internship). Also, if you are earning an income at the internship, you will need to file a nonresident return as well. Here is another article on our blog that will help you understand this rule.
Hello,
I am a single mother of two, should I claim 3 on my w2 or 2?
Hi Ana,
In your situation, you can claim 3. The more allowances you claim, the more money you will see in each paycheck. However, your refund at the end of the tax year may be smaller. There is another article on our blog that may help you further understand why.