How to Fill Out a W-4 Form

We’ll walk you through a W-4 form and show you how to fill it out in five easy steps. It’s important to note that only Step 1 and Step 5 are mandatory; the rest are optional. Yes, both of these forms start with the letter ‘w,’ but that’s where the similarities end. To complete line 2, gather the annual wages amounts from all three jobs using the method noted above in line 1. All that’s left to do is sign and date your form and hand it off to your employer. For example, let’s assume Spouse A has two jobs making $50,000 and $15,000, while Spouse B has a job making $40,000.

When you submit a W-4, you can expect the information to go into effect fairly quickly. But how long exactly before your paycheck reflects the changes largely depends on your payroll system. Line 3 asks for the number of pay periods per year of the highest paying job in your mix.

Topic No. 753, Form W-4 – Employee’s Withholding Certificate

In fact, we recommend that married couples do this at the same time if they are both employed. Additionally, any time you have a major life event you should consider updating your W-4. A marriage, divorce, a new baby, or a child turning 17 will have an effect on your taxes and should be taken into consideration in filling out your W-4. For instance, if you withhold too much, you can end up with a large refund. If you withhold too little, you can create a balance due and potentially an underpayment penalty. Check out our step-by-step process below, which will walk you through how to fill out a W-4 form for a job.

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. You’ll need to account for all jobs you have and for your spouse if applicable and desired. Plus, you should factor in any additional income, credits and deductions available to you.

What Has Changed on Form W-4

Next, you’ll need to add the wages from your two highest-paying jobs together. For example, let’s look at a person who is married filing jointly. When filling out the Multiple Jobs Worksheet, the first thing you will need to differentiate is whether you have two jobs (including both you and your spouse), or three, or more. If you and your spouse each have one job, then you’ll complete line 1 on the form. If you have two jobs and your spouse does not work, you will also complete line 1.

Once you’ve filled in 4(a) and 4(b), all that’s left to do is fill out line 4(c), which indicates the amount of additional tax you’d like withheld each pay period. If you already calculated that number when you completed Step 2, you’re done! If not, I recommend using the IRS online tax withholding estimator to determine whether you need any extra withholding. If your income will be $200,000 or less ($400,000 or less if married filing jointly), then multiply each qualifying child under age 17 by $2,000 and each additional dependent by $500. If you are exempt from tax withholding, you only need to complete Step 1(a), Step 1(b), and Step 5 — and then you can write “Exempt” on Form W-4 in the space below Step 4(c). Generally, you can only claim exempt if you don’t have any tax liability, meaning you didn’t owe any tax last year due to earning income, or you didn’t need to file a tax return at all.

About Form W-4, Employee’s Withholding Certificate

It also asks how many dependents you have and if you have other income (not from jobs), deductions or extra withholding. The new form also provides more privacy in the sense that if you do not want your employer to know you have more than one job, you do not turn in the multiple job worksheet. You definitely don’t want to file exempt if you’re not actually exempt, though. You won’t have any federal income tax withheld from your paycheck, so when you do your taxes in April, you’ll have a giant tax bill that includes late payment penalties. If your total income is under $200,000 (or $400,000 if filing jointly), you can enter how many kids and dependents you have and multiply them by the credit amount.

This will enable you to deduct the necessary tax out of your paycheck now so you don’t have to pay it later. It’s no secret that the IRS excels at making things complicated. And when you’re busy learning the ropes of a new job, trying to fill out a 4-page W-4 form can be a huge hassle. It’s not a good idea to rush through it, though, because a small mistake now can mean withholding too much or too little of your salary for covering your taxes. There have also been several recent changes to the W-4, so you may need to make some adjustments to your current form on file.

After completing this step, single filers with a simple tax situation, as described above, only need to sign and date the form, and they are done. That means you can fill out a W-4, give it https://personal-accounting.org/how-to-fill-out-a-w4/ to your employer and then review your next paycheck to see how much money was withheld. Then you can start estimating how much you’ll have taken out of your paychecks for the full year.

Here is where your paycheck stub(s) for any existing jobs will come in handy. Take the gross amount paid from the last paycheck (assuming it is from a normal paycheck) and multiply it by the number of paychecks you’ll receive in a year. This would be 52 if you receive checks weekly, 26 if you get paid every other week, and so on. Coordination is the key when considering how to fill out your W-4 if you’re married and both of you work. This is because certain factors should only be accounted for on one spouse’s W-4, such as deductions and dependents. As mentioned in the steps above, couples should account for all jobs in their household when they fill out their W-4s.

Finally, try to remember to complete a new W-4 when you experience a major life change. A new child, a significant increase or decrease in income from you or your spouse, or a divorce are all examples of major life changes that might be flags to complete a new W-4. Whenever you run into any major life changes, you’ll want to update this form, too. Obviously, if you get a new job, you’ll fill out a new one, but if you get married, have a kid, or get a second job, you’ll ask for a new W-4, then adjust accordingly. Maybe you started your first job or maybe you gave up the freelance life for full-time employment. Whatever your scenario, if you find yourself filling out a W-4 for the first time, you may be a touch confused by all the fields, worksheets, and forms.

• If you have interest, dividends or capital gains that you’ll owe taxes on, you can indicate the total amount of non-pay income here.
• In fact, we recommend that married couples do this at the same time if they are both employed.
• You may also be able to fill it out online through your employer’s payroll system.
• Allowances were previously loosely tied to personal and dependent exemptions claimed on your tax form.
• If you and your spouse each have one job, then you’ll complete line 1 on the form.