Editable W-4 Tax Form

The W-4 form, Employee’s Withholding Allowance Certificate, is a tax form you fill out and give to your employer, not the Internal Revenue Service (IRS), the United States government agency responsible for the collection of taxes and enforcement of tax laws, for federal and state taxes withholding. The file is typically accomplished whenever you start a new job, but it can be updated when there are significant changes in your personal life that affect your finances. You may update your allowances and withholdings when one of the following happens:

You can submit a new form any time throughout the course of your employment if you wish to change your withholding allowances. By completing it, you notify your employer of the amount of federal tax you wish to be withheld from each paycheck in a pay period. Your employer, on your behalf, sends the money it withholds from your paycheck to the IRS, along with your name and Social Security number (SSN). At the end of the year, your employer will send you a W-2 form, Wage and Tax Statement, that shows the amount of money, among other tax-related financial information, it withheld for you that year.

Tax forms, while they are perhaps one of the most used legal documents among businesses and employees, are generally not considered to be advantageous. However, the W-4 form is based on the idea of allowances. It gives you a slight power over your tax situation and how much pay you take home, allowing you to adjust the portion of your income that is subject to federal income tax.

The W-4 form affects the amount of refund you will get or the tax you will owe when you file a tax refund. It is good to set the right amount of tax withholding; hence, you must balance your taxes to avoid owing or getting a large tax refund, as if you do not withhold enough tax, you could owe an unexpectedly large sum of money to the IRS in April. You may also incur interest and penalties for underpaying your taxes during the year. On the other hand, if you withhold too much tax, while you get a large sum of tax refund money, you might have trouble following a monthly budget. Withholding too much tax is granting the government an interest-free loan.

To determine the accurate number of allowances you should claim using the W-4 form, you can use the Personal Allowances Worksheet or compute using the IRS’s online allowance calculator. The calculator automatically makes adjustments if it shows that you might be qualified for any tax credits that will affect your end-of-year tax liability. In addition, if you are married or planning to file a joint return, the online calculator can accommodate more than one income.

When you begin working for your employer, he or she will give you a W-4 form that you need to complete. You can also download the W-4 form from the IRS website if you want to make any changes and he or she does not happen to have the form on hand. The agency is currently creating a new W-4 form, which will be for the 2020 tax year. The near-final draft will be released in mid to late July and the final version in November. Before the mentioned dates, you should still use the existing W-4 form.

The W-4 form has seven sections to complete and requires your personal information, including your full legal name, marital status, and Social Security number (SSN). The hardest part of filling out the form is deciding the number of allowances to claim, but do not fret. The W-4 form comes with an allowances worksheet that will help you figure out how many to claim. Take note that the more allowances you claim, the less tax will be withheld from your paycheck. Follow these steps to complete the W-4 form:

Step 1
Provide your full legal name and address in their respective boxes.

Step 2
Provide your Social Security number in Box 2. Your employer will use this information when he or she sends the withheld money from your paycheck to the IRS.

Step 3
Check the option that corresponds to your marital status in Box 3. You may check the “Married, but withhold at a higher Single rate” if you are married and your spouse also works. This would solve your apprehension about not having enough tax withheld.

Step 4
Unless you have gotten married recently and changed your name legally, and still have not received an updated Social Security card reflecting your name change, you may leave Box 4, which confirms if your last name differs from that shown on your Social Security card. Otherwise, if the condition applies to you, you may mark the checkbox.

You can call 1-800-772-1213 to request for a Social Security card replacement.

Step 5
Line 5 asks for the total number of allowances you are claiming. The rule to remember is that the higher the number here, the less tax withheld from your pay.

The W-4 form has a Personal Allowances Worksheet. By accomplishing it, you would know how many allowances you are allowed to put in Line 5. Here are the details that you need to know for each part of the worksheet:

1. The standard is to claim one allowance if no one else claims you as a dependent. If you are 16 years old and below and filling out the W-4 form for your summer internship or after-school job, but your parents claim you as a dependent, you are not allowed to claim one allowance.

2. If you are married filing jointly, you can claim one allowance.

3. If you are the head of your household, you can claim one allowance.

4. If you are single or married filing separately and only have on one job; or if you are married filing jointly and have only one job and your spouse does not work; or if your wages from your second job or your spouse’s wages, or the total of both, are $1,500.00 or less, you can claim one allowance.

5. Depending on your income and the number of children you have, you can claim allowances for each of your eligible children. Do not forget to read the conditions to compute accurately how many allowances you are allowed.

6. You can claim allowances for other dependents, a qualifying child or relative who lives with you and whom you support financially. Do not forget to read the conditions to compute accurately how many allowances you are allowed.

7. If you have other credits, you may be entitled to additional allowances. Review the necessary IRS publication worksheets for accuracy.

8. Add up all the numbers from lines A through G.

Step 6
Line 6 is where you write any additional amount you want to withhold from each paycheck, if applicable.

Step 7
If the list of conditions in Line 7 applies to you, you may write “Exempt.”

Exemption from tax withholding
You can use the W-4 form to claim exemption from withholding given that you had no income tax liability in the prior year and you do not expect to a tax liability in the current year. If you are not exempt, you will have to complete the following three worksheets:

• Personal Allowances Worksheet. You are required to fill this out..

• Deductions and Adjustment Worksheet. Accomplish this if you have many deductions.

• Two-Earners or Multiple Jobs Worksheet. Accomplish this if you are married and both you and your spouse work or if you have more than one job..

Step 8
Attest to the truth by signing the W-4 form and entering the date when you signed it; nevertheless, before signing, make sure that all the details you have written are valid and accurate.

How do I change the amount of tax withheld from my paychecks?
If you need to change the amount of tax withheld from your paycheck, you need to complete the W-4 form and give it to your employer. On your behalf, your employer sends the money it will withhold from your paycheck to the IRS

Why do I need to complete a W-4 form?
While the quickest answer is that the IRS requires you to do so, the detailed answer is that the W-2 form informs your employer how much federal income tax to withhold from your pay.

When do I have to submit a new W-4 form?
You can submit a new W-4 form any time you prefer. It is mostly completed when one has major life changes that affect his or her financial situation.

How do I file a new W-4 form?
You can get a W-4 form from your payroll department or the official IRS website. Accomplish, sign, and give the form to your payroll or human resource department. Do not send the form directly to the IRS.

Can I just inform my employer how much to withhold from my paycheck by phone or email?
No, employers are not allowed to accept information from an employee about a new or changed W-4 form by phone or email. If you want to make changes to your W-4 form, you should accomplish and sign the form in person or send it by mail.

I just got hired; when should I submit a W-4?
You must complete the form at hire, before you receive your first paycheck. The IRS states that employers are required to implement a new W-4 form by the start of the first payroll period ending on or after the 30th day from the date of receipt.

How long does a W-4 stay in effect?
There is no limit as to how long a W-4 stays in effect. It remains in effect until you change it.

Can my employer decide how much to withhold from my paycheck?
Your employer has no right to decide how much tax is withheld from your paycheck. In addition, every employer is required to withhold the amount that corresponds with the IRS withholding tables.

Is it better to have more earned income withheld?
Opting to have more tax withheld may feel safer and easier than figuring out how much you should withhold; however, there are no advantages in letting the IRS hold your money completely interest-free.

Why should I not just have more tax withheld and receive a large refund at the end of the year?
While you can allow having more tax withheld from your paycheck, you can make better use of your money by paying the right amount of tax through the year. In addition, the IRS pays no interest to you for the money you give them by having too much tax withheld.

What is a withholding allowance?
A withholding allowance is a number an employer uses to determine how much federal and state income tax to withhold from an employee’s paycheck.

Do allowances affect my paycheck?
The more allowances you claim, that less tax will be taken out of your paycheck. On the other hand, less or zero allowances mean more tax is withheld from your paycheck.

Why should I check my withholding?
The IRS recommends employees to check and review their withholding each year to make sure they are having the right amount of taxes withheld from their paychecks.

Is there a penalty for under-withholding?
According to the IRS, by law, an estimated tax penalty usually applies when a taxpayer pays too little of their tax during the year. The penalty is calculated based on the interest rate changed by the IRS on unpaid taxes. If you want to know more about penalties, you can read the IRS Publication 505.