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 $0 as possible. Getting a big refund when you file taxes is a great feeling. It can also trigger that your withholding needs to be adjusted. The reality is that you could be enjoying that money throughout the year instead of having it withheld from your paychecks.
Regardless, during tax season you’ll need to report the total earnings and tax withheld on a tax return. Use RapidTax to file your taxes without a hassle and receive the maximum refund possible!
hi i am just starting my first official job and I live with my brother (my parents are living out of the country so i live with him), he has me as a dependent. I am 17 now but will turn 18 in 2 weeks..I am going to be working part time and will be making 8.50/hr and I am filling out the form online. Only 3 questions, I put I am single also. SHould I put down zero for the number of allowancesI am claiming or put down 1 for myself?… I guess will also putting down zero for `additional amount you want withheld`? plz help also should i answer yes or no to “I claim exemption from withholding”
Hi Kim,
I suggest taking a look at the IRS Withholding Calculator. It will only take a few minutes to complete and will give you the most accurate amount of allowances to claim based on your current circumstances and the answers you provide.
So the last two w4s that I have filled out. I have put married, claiming 1. Neither job has had any withholdings come out for the state of maine. At the last job I just decided to pay in an extra 25$ a check to both fed and state. I’m just not sure if I am filling it out correctly. We have had to pay in the last two years and to be honest I am kind of tired of it. Can you help. At the first job they said that I didn’t make enough for the state to withhold. Which I though was rather dumb. I was an ed tech. Taxes should come out no matter what. And now at the new job. I make a little more than I did as a tech but no much and on my first check nothing for state. I’m tired of this. I have never has this problem until the last two years and…
Hi Josh,
I suggest taking a look at the IRS Withholding Calculator. It only takes a few minutes to complete and will give you the most accurate amount of allowances to claim based on your current circumstances in order to reach that break-even point at the end of the tax year.
The general rule is that the more allowances you claim, the less withholding you’ll have taken out of your paycheck. If you claim zero, you’ll have the maximum amount taken out. If you claim a large number, you’ll have less taken out. The absolute ideal scenario is to have your tax liability (or refund) at the end of the year be as close to zero as possible.
I am single now and just started work , I filed single claiming 2 dependents, I didn’t want alot of taxes taken out of my paycheck but I also do not want to have to pay at the end of year either, Will I be ok??
Hi Teresa,
Keep in mind that the more allowances you claim, the less money is withheld from each paycheck and the smaller your refund will be at the end of the tax year (with a higher chance of even owing money). I suggest taking a look at the IRS Withholding Calculator. This only takes a few minutes and will calculate the best amount of allowances to withhold based on your situation.
I am a teacher and in the summer I work at a summer camp for a month where I have to fill out a W4. I am married (we filed jointly last year), we have one kid and another on the way within the next four weeks. My wife does not work at the moment but plans to work after the baby is born assuming she finds a job in her field. What should I claim on my W4 for this summer job?
Hi Mark,
I suggest taking a look at the IRS Withholding Calculator. This only takes a few minutes to complete and asks you several specific questions that will help you claim the most accurate amount of allowances on your W-4 so that you aren’t owing money at the end of the tax year or having too much money withheld from each paycheck.
Just started a new job, married and my wife doesn’t work. How should I fill out my w-4. Currently it says single on my pay stub with zero allowances. thanks
Hi Vernon,
For your specific situation, you should claim two allowances.