Hi, @BHall87 , great question! So, the first thing to determine is the minimum amount you must pay in withholding to avoid a penalty. The IRS offers a couple of ways to determine this. According to the IRS:
"You may avoid the Underpayment of Estimated Tax by Individuals Penalty if:
- Your filed tax return shows you owe less than $1,000 or
- You paid at least 90% of the tax shown on the return for the taxable year or 100% of the tax shown on the return for the prior year, whichever amount is less."
Additionally, our free W-4 Calculator might be helpful as a starting point in your calculations. Please let me know if this is helpful!
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