Last year I was told by my HR to submit a w-4 with exemption of federal taxes (very wrong of me to do). I was earning about 10k income with 22k tuition assistance from my employer that gets added to my taxes income at the end of the year.
My employer pays for the taxes on the tuition assistance at the end of the year but didn’t last year as I was tax exempt. I ended up owing too much federal taxes.
Now, I went back and submitted a new W-4 and unchecked the box about tax exemption so I can be taxed. However I am not getting federal taxes taken out at all until I get about 550 net pay and it would only take out about 5 dollars. This is obviously wrong and I need to fix it.
The issue is that my employer adds the tuition assistance which is estimated to be 20k for this year at the end of the year and pays taxes on it. I am not sure how much federal withholding I need as I am not actually earning about 2/3 of the taxed income as it would be paid for my school as tuition. How much should I withold, can I make it a percentage amount or is it a flat amount and it will take a huge amount before my employer adds the the tuition assistance money at the end?
sorry for any confusion I am still very new to paying taxes
