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 have an offer for a second job starting in april, I just wanted to know should I put 0 to withhold max taxes from my second employer , I am married with no kids and spouse does not work.
My first employer I have 0 allowances and I would like to do the same for my new job.
The only problem I think is I would be almost doubling my income to around 270K with both jobs annually – how can I ensure most taxes are withheld so that I don’t own anything towards year end.
Both my jobs would be in the state of CA.
Appreciate your help.
Hi Abi,
Congrats on the new position! In short, yes you would claim zero allowances on both W-4 forms. Claiming zero allowances allows for the maximum amount of income to be withheld to cover your tax liability. Claiming more allowances would decrease the amount of your income that is withheld. You are issued a tax bill when too little is withheld throughout the year. Since you are entering into a second job, you will have a second source of income. I suggest taking a look at the second page of the W-4 form for the Multiple Jobs Worksheet. This will allow you to have an additional amount of income withheld so that you do not end up with a unnecessarily high tax bill after filing.
I am a single father who claims his son every other year. Should I just claim 1 for myself on the W-4 and then claim him on my tax return when it’s my year?
Hi James,
You can update your W-4 as you see it necessary. In your tax situation, you may consider updating your W-4 every year; claiming one allowance on years that you will not be claiming your son as a dependent and claiming two on years that you will.
The more allowances you claim, the less will be withheld from your income for taxes. The less allowances you claim, the more will be withheld from your income. If you prefer to leave your W-4 as only claiming one allowance (to have more withheld from your paychecks) whether you’re claiming a dependent or not, then you can so without penalty.
Im a single father with full time job and 1 dependent, which is my child. How many Allowances do I claim?
Hi Mario,
When completing your W-4 form, you want to keep in mind that the more allowances you claim, the less is withheld from your paycheck to cover taxes owed to the IRS. The less allowances you claim, the more income is withheld from your paychecks to cover your tax liability. If an excess is withheld throughout the year, then the IRS will issue you a refund. If too little is withheld, then you will owe the IRS after filing.
In your tax situation, I suggest claiming one allowance for yourself and an additional allowance for each dependent you will claim on your tax return. You may also want to claim an allowance if you will file as head of household.
How should I fill out my w4 if I have two children? I would like to have a bigger tax return like I did in 2012. not sure how I filled out the form differently, getting a big return for next year is very important to me. How should I fill out the form. I have 3 allowances, me and my two children and I get confused at the additional flat, additional flat + %, additional %, Blocked, flat dollar amount, flat $ amount + fixed %, flat %…. all of those confuse the heck outta me as I said I am trying to figure out which one will be the best for me to get a larger return. Please help. I hope you can help me.
Hi Lyn,
Don’t worry too much about the confusing IRS tax jargon. A good rule of thumb to follow is to claim one allowance for yourself and an additional one for each dependent you will claim on your tax return. However, if you prefer to have more withheld from your paychecks, you can claim less allowances. You mentioned that you are claiming 3 allowances currently. Try lowering that to two allowances. You will see more income being withheld from your paychecks but this will result in less being due (or more of a refund) after filing taxes for the year.
Hi there,
I got married in July 2015. My husband graduated college in February this year, and just started working as a contractor three days ago. My work is asking me to redo my W4 form because my name has changed, and I’m not sure what to claim. Essentially, I’d like if nothing changes from what is being withheld now. I don’t know if we file our taxes joint, or separate. Please advise.
Thanks!
Kelsey
Hi Kelsey,
Congrats on getting married!
When you update your W-4 form, you don’t need to update the amount of allowances you are claiming. You should update your filing status though. You’ll want your W-4 form to reflect your tax return as closely as possible so that you don’t owe the IRS too much or have too much withheld over the year.
When it comes to filing your tax return, you may want to file a joint tax return. This will give you the most tax benefits, including a higher standard deduction which will ultimately lower your tax due to the IRS. Take a look at our article about filing joint tax returns HERE. You should get a bit more insight.