Hi Chrsm801, It can be tricky finding that sweet spot of tax withheld to not owe tax and not receive too large a tax refund! Since you are both working, and have two dependents, it is a good idea to make sure you are both not claiming both dependents on the Form W-4.
If you need more tax withheld, than one of you could submit a Form W-4 with no dependents, which will increase the tax withheld, and then reduce your tax due when filing your tax return.
Once you complete the form, give it to your employer. Then, keep a close eye on your next few paychecks to see how the changes impacted your federal income tax withholding. You can compare your 2021 total tax from your 2021 tax return to the year-to-date federal tax withholdings from each of your most recent paycheck to see if you are getting closer to the total tax you need withheld. Keep in mind it is late July, so may take a few pay periods to notice a cumulative increase.
If you find you still need more withheld, you can put an amount on Additional Withholding in Step 4 (c) – Extra Withholdings to be withheld each pay period.
I hope you find this helpful!
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