Form W-4 2023: How to Fill It Out BerniePortal

Form W-4 2023: How to Fill It Out BerniePortal

how to fill out a w4 for dummies

Too little withheld and you’ll end up owing the government money. You want your withholding to be just right so you break even when tax time rolls around. If you haven’t recently, check with your employer to make sure you’re having them hold back just enough to cover your tax obligations (we’ll show you how to do that below). Getting your tax withholding amount right helps keep more money in your pocket while ensuring you have enough paid in to avoid an underpayment penalty. If you aren’t sure the appropriate amount is being taken out of your paycheck, you can ask your tax professional for input or do it yourself with the IRS’ new Form W-4 worksheets. The 2020 redesign was to reflect changes to tax law made in 2017 by the Tax Cuts and Jobs Act.

how to fill out a w4 for dummies

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. This is one of the major changes brought about in the new W4 form, the elimination of withholding allowances.

Step 1: Provide Your Information

Choosing to withhold more throughout the year can help you avoid a large tax bill when you file your return. But, if you have any unearned income (i.e. interest or dividends) or receive payment from freelance work, there is a good chance taxes are not automatically withdrawn from those payments. In that case, you’re responsible for ensuring the taxes due on that amount gets paid to the IRS. Regardless of when you started your job (either January or December), you’ll use the $33,800 number for your calculation.

  • If you have too little tax withheld, you could owe a surprisingly large sum to the IRS in April, plus interest and penalties for underpaying your taxes during the year.
  • Form W-4 is crucial to employee tax reporting and employer withholding.
  • If you’d like to know how to fill out your W-4 form to get more money, you’ll want to pay close attention to Steps 3 and 4.
  • A tax withholding estimator is a tool that will give you the exact amount that you need to withhold.
  • 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.

You no longer need to calculate how many allowances to claim to increase or decrease your withholding. The new form instead asks you to indicate whether you have more than one job or if your spouse works. 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. 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).

Step 2: Multiple Jobs or Spouse Works

It is important to fill this form as a part of joining formalities because this determines how much tax the employer would withhold from the employee’s paycheque. Form W-4 is crucial to employee tax reporting and employer withholding. This form got a major overhaul from the IRS in 2020, but there are some updates for 2023 as well. And many employees don’t know how to fill out Form W-4 correctly—which can lead to an unpleasant surprise when they owe more taxes than expected.

If the answer to any of the above-mentioned questions is “yes,” then you should revisit employee’s w4 form within the year. Alternatively, you can ask them to fill the forms using the following steps. The employees can also claim exemption, in case there was no liability during the relevant period for which the tax has been deducted. To calculate the most accurate withholding for Steps 2-4, you can use TurboTax’s W-4 Withholding Calculator. Get unlimited advice, an expert final review and your maximum refund, guaranteed with Live Assisted Basic.


A W-4 form, formally titled “Employee’s Withholding Certificate,” is an IRS form that employees fill out and submit to their employers, typically when starting a new job. Employers use the information provided on a W-4 to calculate how much tax to withhold from an employee’s paycheck throughout the year. Each of these children should how to fill out a w4 for dummies qualify for the  child tax credit so calculating these credits into your withholding amount will reduce the amount of tax withheld. These tax credits are also refundable tax credits, meaning, you could get back money above what was withheld by your employer. Add the number of dependents you can claim on your tax return.

  • For current tax or legal advice, please consult with an accountant or an attorney.
  • Every employee is asked to fill out a W-4, usually on the first day of the job.
  • The IRS replaced the method for determining the amount to withhold beginning in 2020 to reduce the complexity of calculating how much to withhold from each paycheck.
  • You can file exempt if you expect to have no tax liability during the year.
  • The first step is to provide all the basic details, such as name, address, social security number.

To make sure you withhold the right amount of taxes, you will need to submit some paperwork when you start a new job — specifically, a W-4 Form. This document is used to report the necessary information related to your tax situation, and employers use this to calculate how much federal income tax to withhold from each of your paychecks. In step 2, section C of the W4 form (as outlined above) you can write the word “exempt” if you are exempt from federal tax withholdings. This means that you won’t pay federal income tax through your paychecks during the year. If you’re filling out a W-4 for the first time in a while, you might notice some changes in the form that tells your employer how much tax to withhold from your paycheck. The Internal Revenue Service redesigned it in 2020 in a way that’s intended to make things easier and more accurate.

Multiple Jobs, High Income Earners, and Working Spouses

A tax credit is a type of tax benefit that allows those who qualify for it to lower their tax bill by the value of the tax credit. Eligibility for tax credits can depend on income, tax-filing status, and other qualifications. Credits can be refundable, nonrefundable or partially refundable. But the basics of the form are the same, so no need to panic! Too much withheld and you’re giving Uncle Sam money without any interest.

  • Not paying enough during the year can result in a tax bill and perhaps a penalty, while withholding too much can create a refund when you file your tax return.
  • Use the Step 4(b)—Deductions Worksheet found on page 4 of the W4 form to calculate this number.
  • In fact, we recommend that married couples do this at the same time if they are both employed.
  • In fact, the W-4 revamp and the tax changes since the TCJA may be a reason to look again at the W-4 you filed back when you first came to your employer and see if you need to make changes.
  • 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.
  • What I’d like to see on these forms is an option to just withhold a straight percentage.
  • The rest of step 5 is for your employer to fill out so don’t write in the Employers Only section of step 5.

If your life circumstances change and you need to change something on your W-4, you can always make an adjustment. If you get married, have a baby or take on a second job, you’ll need to adjust your W-4 accordingly. The information contained in this article is not tax or legal advice and is not a substitute for such advice. State and federal laws change frequently, and the information in this article may not reflect your own state’s laws or the most recent changes to the law. For current tax or legal advice, please consult with an accountant or an attorney. Keep in mind, that’s in addition to your “normal” withholding.

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But how long exactly before your paycheck reflects the changes largely depends on your payroll system. 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. Line 3 asks for the number of pay periods per year of the highest paying job in your mix.

  • On the form, you’ll find a variety of important information.
  • 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.
  • In most cases, if you earn money, the IRS expects you to pay taxes on it.
  • However, you might still owe taxes if, for example, you are self-employed and don’t account for those taxes by withholding more on your W-4.
  • To use the estimator, locate your paystubs and use them to enter your current state and federal withholdings.

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.

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