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Employee's Withholding Allowance Certificate

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By Roger Chartier

Form W-4

Tips on how to use the W4 form

First read this if you downloaded a W-4 Form before January 18, 2013.
The W-4 Form has been revised. The IRS is telling us that:

" In the Deductions and Adjustments Worksheet on page 2, the "7.5%" referenced in line 1 has been changed to "10% (7.5% if either you or your spouse was born before January 2, 1949)".

Also in line 1, reference to certain income limitations for itemized deductions, and a reference to Publication 505, were added. Employers and employees should use the revised form".

The revised W-4 form is on this website.  

The IRS suggests

Filling out and submitting a new form every year or when your financial situation changes.

Some ideas for filling out the W-4 Form

  1. You can fill out the W-4 form downloaded from this website with your computer, by typing into the boxes to fill in what is required.

    A good idea is to save the file first then open it from where you have saved it on your computer and type into the form.

    It is finished and so then save again with a varied title so that you have both an empty form and the one that is a filled out a back-up copy of what you are submitting to your employer.

  2. The next thing to consider on the form is how many withholding allowances that you are going to claim.

  3. Personal Allowances Worksheet will be using lines A through Line H.

    Couples who are married, and are filing jointly, should calculate the withholding allowances as one. Then divide them between each other.

    You can figure out what your total income is together but you can only claim one allowance per person, therefore not the same allowance that your spouse will claim. Your higher income can be to your advantage for deductions. It is up to you.
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  1. If you are only going to use the standard deduction and no others then go to section 7

  2. If you are earning more money that just wages and it is significant, and you are not taking the standard deduction then look to the Deductions and Adjustments Worksheet on Pub 505 for information to help you with that.

    You might need your previous return for itemized deductions, adjustments to income and non-wage income.

  3. This section is for those who have more than one job

  4. This leaves you with your withholding allowances figure.

  5. Go ahead and fill the rest of the form and submit it to your employer.

The form tells you that if you are exempt you would fill it out as per the instructions for that purpose.  See the current Publication 505

If someone is claiming you or can claim you as a dependent on their tax return, you can't claim exemption from withholding if your income is more than $950.00 and includes more than $300.00 in unearned income such as dividends or interest.

On the form, there is a Personal Allowances Worksheet for you to fill out if you are not exempt.

There is a consideration for certain tax credits, itemized deductions, adjustment to income or a two earner (multiple jobs) situation.

Although you must complete all of the worksheets that apply, you can still claim zero or fewer allowances.

There are instructions for Head of Households and how to file for that, as well as provisions for children as dependents.

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The form W4 instructions suggests that if you have a large amount of unearned income you might consider making estimated tax payments by taking advantage of the form 1040-es.

If you have more than one job or two spouses are earning it is suggested that it is better to take deductions for children from the pay check with the higher income.

To download a printable IRS Form W-4 Click on the image of the W4 form on the left.

Be sure to carefully read the instructions as they are on the form. If you feel that you want to file a volunteer withholding request, file the Form W4V .

Non resident aliens take notice

There is a special method for you to use in filling out the W-4 form, and you can read about it here on the IRS website.
http://www.irs.gov/Individuals/International-Taxpayers/Withholding-Exemptions---Personal-Exemptions---Form-W-4

 

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