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Understanding Form W-4

When you start a new job, your employer will ask you to complete a Form W-4. This form helps you control how much money is deducted from your paycheck for taxes. Be sure to update the form when you encounter major life events such as getting married, having a baby or buying a house.

  1. Personal Allowances Worksheet

    This worksheet helps you determine the correct number of allowances. Remember: the more allowances you claim, the less money is withheld for income taxes. (So, if you received a big tax refund last year, you may want to increase your allowances.)

  2. Employee's Withholding Allowance Certificate

    This portion of the form is submitted to your employer. Fill it out completely—and don't forget to sign and date it.

  3. Your total allowances

    Increase your total allowances (caclulated from the Personal Allowances WOrksheet) in box 5 of the Employee's Withholding Allowance Certificate. In general, single people with one job usually have only one allowance.

  4. Additional Withholdings

    If you owed the IRS a lot of money for the previous tax year, you might want to authorize your employer to withhold additional money from your paycheck. Doing so will reduce the amount of taxes you'll owe come April. Indicate if you'd like additional withholdings deducted in box 6 of the Employee's Withholding Allowance Certificate.

w4 Form

The information on this website is for educational purposes only. It is not intended to be a substitute for specific individualized tax, legal, or investment planning advice. Where specific advice is necessary or appropriate, consult with a qualified tax advisor, CPA, financial planner, or investment manager.

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