How to Fill Out a W-4 Correctly

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.

*Check your eligibility to claim the child tax credit. This gives you more money after filing but also allows you to claim additional allowances on your W-4.

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!

 

Get Your Refund

Fill out a W-4 correctly to have the necessary income withheld for tax.

777 Replies to “How to Fill Out a W-4 Correctly”

  1. Hi, I am married and I work full time. My wife works part time. We have no children, How many allowances should we each claim?

    1. Hi Kyle,

      If you are planning on claiming your wife as a qualifying dependent on your tax return, you should claim two allowances while she claims zero. Now, if you are not claiming your wife as a dependent and instead will file a joint return or two separate “married filing separate” returns, you should each claim one allowance on your W-4 forms.

  2. Hi. I am married, pregnant and my husband doesn’t work. I’m about to start another job so I will have two for now. Both full-time but probably will leave the other one eventually. With the current situation though, what should I put on my total allowances? And is that how many dependents I should claim? Thank you in advance.

    1. Hi G del Rio,

      Congrats on the new addition coming soon!

      Since you have two jobs, you either want to split your allowances between them evenly or claim all allowances on the W-4 for the higher paying job. This will turn out to be most financially helpful to you. As of right now, you should probably claim two allowances. Once your newborn arrives, you can update your W-4 form to reflect your paycheck in the very next pay period.

      Also, keep in mind that if you do leave one job, you update your W-4 form for the job that you are staying with. Good luck with everything!

  3. Hi,

    I am a single mother. I had a baby last year. My taxes seem to be a kind of messy as I used to be a non-resident and since mid last year I got residence and have my baby. I used to travel abroad for work and in other states in the US, so my company did a kind of equalization taxes on my behalf. This year as I do not travel anymore I would like to get the most from my paycheck. Today I am getting around 47% of it. I have noticed HR at my company updated my W-4 with 3 allowances, but I pay a daycare for my child and I help my mom financially. She actually spends 5 months living with me per year, making this additional expenses I have to deal with. My mom is not a resident. How can I change my W-4 to get the most from each paycheck? Is it possible to change it to 6 allowances?

    1. Hi Juliette,

      Congratulations on your new addition!

      The first thing I want to address based on what you said above is that your HR department is not allowed to update your W-4 form without your consent. You need to be the one to sign the document with the amount of allowances you will be claiming.

      When it comes to the amount you should be claiming, there is no magic number. You are able to update your W-4 form to claim 6 allowances if you would like since you are faced with a few extra financial burdens at the moment. Just remember that this may result in a tax amount due after you file your taxes. If too little taxes are withheld from each paycheck throughout the year, then you will owe the remaining amount to the IRS after filing. If too much is withheld throughout the year, then the IRS will issue a refund. That being said, the smaller the amount of allowances claimed on your W-4, the higher your refund amount (or smaller your tax due) will be while the higher the amount of allowances you claim on your W-4, the higher your tax amount due (or smaller your refund) will be.

      Unfortunately, you will not be able to claim your mother as a qualifying dependent since she is not a US citizen. On the other hand, as long as your child is a citizen, you will be able to claim him/her as a dependent. This will lessen your tax burden when filing.

  4. Hello,
    I recently had a baby and I would like to update my W4. I am single and I also have a five year old. I am the head of household. In the past I’ve Not claimed the correct amount of allowances. I am unsure as to calculate everything. Help!

    1. Hi Michele,

      Congratulations on the new addition!

      When updating your W-4 form, you first want to decide what is more beneficial to you:
      1. Claiming a moderate amount of allowances. Paying taxes throughout the year at a steady rate from each paycheck and most likely breaking even after filing,
      2. Claiming a high amount of allowances. Paying taxes to the IRS after filing in a lump sum because you had very little/no taxes withheld from your paychecks, or
      3. Claiming the minimum amount of allowances (0-1). This usually will result in receiving a refund since you received less in each paycheck throughout the year.

      For option #1, you will want to claim 2-3 allowances to cover yourself and your dependents.
      For option #2, you should follow the worksheet to the tee on the W-4 form and report that amount.
      For option #3, you can claim 0-1 allowances.

      Also keep in mind that you will most likely be eligible to claim the child tax credit which will decrease your taxes due.

  5. I about to start a new job I have one child , his mother claims him every year , should I put 1 or 2 , I checked with my current job I put down 2 dependents and I still got a tax refund not alot but I got a few hundreds , what should I put down in my new w4 for my new job ? And I also have the tax credit taken out for buying a house in 2008 what do you recommend ?

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