You can claim exemption from withholding for 2021 only if you meet both of these conditions:
- You had no federal income tax liability in 2020, and
- You expect to have no federal income tax liability in 2021.
If both of those statements aren't true, you shouldn't claim exempt, and just leave the dropdown as -- Make a Selection --.
Please see Exemption from withholding in the instructions for Form W-4.
