How many tax exemptions should i claim

how many tax exemptions should i claim

You can download form W4 from the IRS site or one should be provided by your employer, your state may/will have an equivalent if your state exacts income. show more You can download form W4 from the IRS site or one should be provided by your employer, your state may/will have an equivalent if your state exacts income tax. Follow the instructions and/or check the IRS.gov site - they often provide examples. The W4 form is submitted to your employer and can be re-done and re-submitted any time.

If you itemize your deductions and/or have experienced having a lot more than necessary withheld for whatever reasons (been getting a big refund) then you can increase the number of exemptions you claim on your W4 (it is allowed to be different than what you finally claim on your return but be careful. see below) - each additional exemption claimed will decrease total year's withholding by approximately your tax rate times a dependent exemption amount.

If you want or need to have more withheld you have more options: you can decrease the number of exemptions on your W4 OR have a set amount additionally

withheld per pay period on your W4 OR plan to file and pay additional estimated tax payments quarterly.

If you use or plan to use a professional tax preparer you might ask for their recomendation. You might also ask your employer's HR person/department for help. Some employer's provide estimating tool calculators on their payroll sites. You can also just call the IRS for help.

It is VERY VERY important to not under-estimate your withholding by over claiming exemptions since it might lead not just to owing taxes but also a possible penalty for under withholding. One suggestion is to do a dry run (estimation) of your full year's earnings and taxes half way through the year, and any time one time special events hit such as gambling winnings, business gains, bonuses, etc.

If you don't fully and completely understand your own tax filings (don't feel bad, it has gotten increasingly complex) it is best to seek guidance from a qualified professional tax preparer, accountant, or financial advisor. Please do not listen to any specific advice from your brother-in-law (or anyone answering on this or any other site) unless he is one.

Source: nz.answers.yahoo.com

Category: Taxes

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