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!
I just started working part time. I file jointly with my husband and we have 3 kids. What do I claim on my w4?
Hi Dom,
Typically, it is more beneficial for the spouse with the higher income to claim the bulk of the allowances on their W4.
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 also 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 in order to reach that break-even point at the end of the tax year.
Dear Tax Advisor, your article was helpful its sooo embarrassing I don’t understand this. This is my second real job. My recent check I worked 30.5 hours making $11 an hour and got paid $252. This is my last week at that temp job but I still want to update my w-4.
On the personal Allowance worksheet I claimed 1 on line A, On B I claimed 1 because Im single and don’t claim anyone, on C I put 0, D I put 0, E I put 1, F I put 0, G I put 0, and H I put 2.
On the Employee Withholding Certificate I put 0 on everything and line 7 I put Exempt.
On the Deductions and Adjustments worksheet page 2 I apparently left that blank. I have my form in front of me that’s what I’m reading from. I just really don’t get what I did wrong. But I need to figure it out lol before I start a job somewhere else.
If you can assist me Id be so grateful, its the weekend so not sure how soon you will see this..So in conclusion, I’m Single, no kids, in Ohio, no one claims me, I don’t own any real estate, please help because they are taking way to much out of my check.
Thanks so much, sorry for the long paragraph. I hope I made sense
Hi Bianca,
No need to apologize as this can get confusing!
If I am understanding correctly, you claimed two allowances but also claimed Exempt. However, on the Employee Withholding Allowance Certificate, you would want to put two on line #5 (since that is just a summary of lines A-H). Therefore, you cannot claim Exempt as well. I suggest sticking with the two allowances and updating your W4 as not Exempt.
Hi I’m a single mom I only have one child and I’m a dependent I only work one job. what do I put down on lines A-H and what lines do I put the numbers on I’m very confused
Hi Tiffany,
Since you are a dependent and someone is claiming you, you would claim zero allowances. If you are claiming your child then you would claim one or two allowances. If someone else is claiming your child, you can stick with claiming zero allowances.
For your situation, I also 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 in order to reach that break-even point at the end of the tax year.
I just started a new job recently. I’m married with 1 child but my wife is pregnant and due in 3 months. I would like to receive a refund and not have too much taken out my paycheck. What should I put on my w4? My wife owns a business and will be filing tax at the end of the year. Are we suppose to file jointly or separate? She will likely pay and that’s ok but I would like a refund. Please help! Thanks
Hi Dave,
Congratulations on the new addition!
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 also 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 in order to reach that break-even point at the end of the tax year.
I’m married but can i clain as single with no dependents to have more taxes taken out?
Hi Robert,
You can still get the single withholding rate if you are married. The W-4 has a checkbox labeled “Married, but withhold at higher Single rate.” By making this selection you get the single withholding rate even though you are married. This box is located on the bottom half of the first page of the W4 (option #3).