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 Tax Advisor,
I need to know how to file. I work in a state that does not pay taxes I guess to a certain extent (FL) and I live in GA. I have 1 dependent, I am single, head of house and my job does not offer the option of putting head of house, so for me I have to choose single. I set my w-4 up like this filing status single (only option applying to my situation), allowances 3 (single, 1 dependent, and 1 for something else I qualified for), and left the exempt indicator blank. Last year I claimed 5 allowances because I was making way more, and wanted my more money monthly and could afford a lesser return, but still had enough return to say ‘oh yeah’ I can see my end of year money. I am making 2100 less yearly, but I would like to get a little more than the norm monthly since I am making less now, but also would like to get a return showing proper deductions. Oh by the way I stopped one job at the end of Sept and started new one end of October if this makes a difference.
Hi Vikki,
When completing your W-4, it is the IRS that will not allow taxpayers to select head of household. You are provided the three options shown; single, married, and married by withhold at higher single rate. Keep in mind that you will be able to file your actual tax return as head of household if you qualify. When it comes to living in Florida, you will not have any Florida tax withheld from your paychecks since the state does not require income tax to be paid. You will, however, see that federal taxes are being withheld. These taxes are received by two separate entities; the IRS and (what would be) the Florida State Department of Revenue. Based on what you have stated above, I would suggest sticking with three allowances. You may want to consider checking out the Multiple Jobs Worksheet on page 2 of the W-4 form since you are working two jobs.
I recently got married 2 weeks ago and both my husband and I work. I have a child from a previous relationship that his father cannot claim. How should I fill out my new W4?
Hi Fern,
Congratulations on tying the knot!
If you will be claiming your son as a dependent on your tax return, you can add an additional allowance for him on your W-4 as per the Personal Allowances Worksheet. Be sure to see if you also qualify for the credit. This will allow you to claim additional allowances. If you plan to file a joint tax return with your husband, you will be able to still report your son as a dependent (assuming you meet all IRS guidelines).
Ok so I am married with 3 children. My husband works full time and I have 2 jobs one part time and one full. By myself my monthly income is 1200 and my husbands is 3600. I’m trying to find out how I should go about filling out my w-4 for my full time job. I don’t want so many taxes taken out of check. My husband has all 3 of our kids as exemptions on his w-4 and we always file jointly. Should I also put our 3 kids on my w-4? This is where I get lost Please help. Thanks in advance.
Hi Nina,
The ideal situation is to have your W-4 reflect how you plan to file your tax return. If you file a joint return, then you both won’t want to each claim 3 allowances for your 3 children. This would probably have you owing the IRS after filing. Taxpayers in similar situations will have the spouse earning the higher income claim the majority or all of the allowances for the family while the spouse earning less will claim zero or one allowance. If you want less withheld, then consider splitting allowances more evenly between you and your spouse.
California is my state of legal residency and where my primary home is located. I am working for a Texas based company, who is asking me to use a Texas address rather than a California address on my W-4 paperwork. If I use a friend’s Texas address on the form will this be an issue, assuming all my tax returns and other irs filings have my primary California address? Thank you
Hi John,
Using an address where you do not actually reside is risky. It’s pretty clear that your employer is asking you to do this so that they do not need to have an employee on their payroll that they need to withhold California tax for (this would hold them to an additional cost). However, if the IRS catches on, you will be the one facing penalties (at the very least); not your employer. Your employer is required to follow rules for whichever address you report on your W-4 form. They aren’t necessarily responsible for whether or not you are being truthful or not. This could also place you on a sticky situation because by reporting a Texas address, you would not be held liable to pay ANY state income tax, when in reality, you should be paying a portion to California. I would strongly suggest reporting your actual address on your W-4 and tax return.
I am not sure what to claim on my W4. I am single. I have two jobs. I have a son who lives with me, but his Dad claims him on his taxes.
Hi Brittany,
How you choose to complete your W-4 form will depend on the amount of income you are earning at each job. I would suggest claiming one allowance for yourself on the higher paying job and also using the worksheet on the second page of your W-4 for two income sources. When it comes to claiming an allowance for your son – you wouldn’t if his father will be claiming him again this year.