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 just started a new job. At the end of the yr i will be filing jointly with my husband. Heres the catch: he doesnt work and we have 3 kids. I’d rather have the largest return possible. How do i fill out the w4 for my job????
Hi Maria,
If you would prefer to have the maximum withheld from your paychecks to decrease your chance of owing, then you can claim zero allowances on your W-4 form. The less allowances you claim, the more is withheld while the more allowances you claim, the less is withheld toward taxes owed to the IRS. If too much is withheld, that is when the IRS will issue a refund. If you would prefer to have more withheld, then you can always update your W-4 at any point with your employer.
Hi I am married with one child started a job a month ago but I believe I added up my total incorrectly what is the number that I should put down is it married with one dependent for a total of 3?
Hi Jasmin,
The amount of allowances you claim on your W-4 is typically based on how you plan to file your tax return. You didn’t mention if you plan to file a joint tax return or not with your spouse, but those in similar situations will have the higher-earning spouse claim the majority or all of the allowances on their W-4 form. Something to keep in mind is that the higher the amount of allowances you claim, the less is withheld from your income and vice versa. If too little is withheld throughout the year, then you will owe the IRS after filing. If too much is withheld by the IRS, then you will be issued a tax refund.
Hello!
If I am married, with two young kids, and both my spouse and I hold one full time job each, do you recommend that we EACH claim 4 on our W2s?
Currently I claim 2, and my husband claims 2. We typically get a large refund back.
Should we be claiming 4 each? Or should one of us claim one, while the other claims 4? Or are we doing the right thing. I am not so concerned about the pay we take home, rather, if we are doing the correct thing. Feel free to ask questions to clarify! Thank you!
Hi Leah,
If you and your husband plan to file a joint tax return, then it is common to split the amount of allowances if you earn about the same amount of income. If your income is drastically different from your spouse, then it is common for the spouse earning the higher income to claim the majority (or all) of the allowances instead of splitting them. Based on what you have shared above, I suggest sticking with what you and your spouse are doing now as opposed to each claiming 4 allowances. That could cause you to owe the IRS after filing for the year instead of being issued a tax refund.
Hi, my wife and I are really confused on what we need to claim on our W-4. We have 1 child. Do we do single or married? Should we claim 0,1, or 2? Thanks for your help
Hi Oscar,
Not to worry! The W-4 can seem confusing, especially when reporting additional allowances. Remember that you want your W-4 form to reflect your tax return as much as possible. You will report ‘married’ on each of your W-4 forms as it will work in your benefit come time to file. Only one person can claim a dependent. This is important to keep in mind when considering your child. Most of the time, the spouse with the higher income will report the additional allowance for the dependent child. Aside from this, most taxpayers will claim one allowance for themselves. If you follow trend, the lower earning spouse will claim one allowance while the higher-earner will claim two allowances.
I am single, have no children and work one job.
I want to claim “1” instead of “0” but I don’t really know how to fill out my form.
On line A, it says “Enter”1” for yourself if no one else can claim you as a dependent.
Do I just put “1” on line A and put on my total allowances I claim “1”?
Or do I have to put any other numbers in.
I really don’t understand the form.
Hi Karlee,
Completing your W-4 form can be confusing. Typically, single taxpayers with no dependents and one source of income, like yourself, will claim either one or zero allowance(s). It is important to know that you are only required to submit the bottom portion of your W-4 form to your employer. You are not required to complete the personal allowances worksheet at all. It is solely for your own records. You only need to take the total number of allowances and report that on line 5.
That being said, you should know how allowances affect your income. The more allowances you claim, the less is withheld from your paychecks throughout the year for taxes you owe. The less allowances you claim, the more is withheld from your paychecks to cover taxes owed. You have the option to claim zero allowances. This allows for the maximum amount of income to be withheld from your paychecks to cover taxes. If too little is withheld over the year, that is when a tax due amount is calculated and you will receive a tax bill from the IRS. If too much was withheld, then you will be issued a refund.