how to fill out a w4 for dummies

Keeping your W-4 current and accurate could keep you from a surprise tax bill when you file. For 2b, add the value for the two jobs that have the highest annual wages. Use that total when reviewing the “Higher Paying Job” row. Use the lowest paying job in the “Lower Paying Job” column to find the amount from the appropriate table on page 4. This is where you fill out the basic information on the form all about you and your personal data.

Add the number of dependents you can claim on your tax return. To qualify, your income must be less than $200,000 (or $400,000 if married filing jointly). The child must be under age 16 as of Dec. 31 and live with you for more than half the year. Including your tax credits and deductions—other than the standard deduction—in your estimates will help to lower your withholding, provide a bigger paycheck and help you control your refund. This refers to not only married taxpayers filing jointly, but also taxpayers with multiple jobs. This will provide a W-4 printout for each taxpayer when filing jointly and allow the taxpayer(s) to complete a W-4 for each job.

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You’ll also need to provide information such as any additional amount of money you want to be withheld from your paycheck or if you’re exempt from making tax payments. Taxpayers are required by law to pay most of their tax obligation during the year rather than at the end of the year. This can be done by either changing your deductions and having more tax withheld from paychecks or pension payments, or by making estimated tax payments. Before you begin filling out the W-4 form, plan to sit down with your spouse to determine whether or not you will be filing a joint tax return together for the current year. Also review the information you’ll need to complete the form. Checking the box for the default method may seem like the easiest choice.

  • In fact, they are related in that taking more taxes out of your pay can mean a larger refund—and the inverse can be true.
  • How you fill out a W-4 can have a major effect on whether taxes are owed or a refund is given.
  • If your state has a state-level income tax (not all do), it may have its own form you’ll have to fill out in order to have state tax withheld from your paycheck.
  • It also asks whether you wish to increase or decrease your withholding amount based on certain factors like a second job or your eligibility for itemized deductions.

If you have a second job, or if you’re married and your spouse works, you can use the worksheets or the IRS calculator to determine the appropriate amount to enter. With this new W-4, the IRS removed personal exemptions and allowances, which were confusing. Instead, you now directly enter dollar amounts for dependents based on child tax credits. If you will owe more in taxes than what your salary alone would indicate, you can say here how much more you want to be withheld per pay period. If the extra amount is because your spouse works or because you have more than one job, you enter the amount you calculated in Step 2 – plus any other amount you want to be withheld.

Step 1: Provide Your Information

As mentioned at the top of this post, your W-4 withholdings affect what’s taken out of your paycheck each period and your potential refund. In fact, they are related in that taking more taxes out of your pay can mean a Choosing The Best Accountant for Your Law Firm larger refund—and the inverse can be true. Just like it’s important for only one spouse to allow for child-related tax credits on their W-4, it’s important that you only allow for other income or deductions on one W-4.

how to fill out a w4 for dummies

If you need further assistance for discerning which allowances you should claim on your W-4, try this IRS withholding calculator. But while you might consider a W-4 the gift that keeps on giving (or taking), it’s also one that should come with instructions. Deductions, allowances, and basic addition can make this process confusing. Luckily, I’ve got a simple guide to W-4 Forms for you right here.

Can you claim exemption from tax withholding on your W-4?

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Different than when you filled out W-4 forms in the past, you’ll have to fill out your W-4 with your combined income in mind, including self-employment. Otherwise, you may set up your withholding at too low a rate. This article will address the main steps in how to fill out a W-4 form and how you might fill it out for specific situations. To learn more about the form itself, read our What is a W-4 tax form post. Filling out a W-4 form is essentially a decision making moment. Because W-4 directly affects the amount withheld on your paycheck and your potential refund.

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