Deductions & credits

You were probably having more tax withheld than you needed, which will result in a tax refund when you file your tax return. Changing your withholding to head of household status means that you will have less tax withheld from your paychecks. You will get more take-home money each week but a smaller refund at the end of the year.

 

Your actual tax liability is only calculated on form 1040 at the end of the year, and doesn’t change regardless of how you fill out your W-4. The W-4 is used to determine how much to have withheld from each paycheck so that you will eventually cover your tax liability. If you are under withheld, you owe additional payments before April 15 and may also be assessed a penalty. If you have excess withholding, that is where your tax refund comes from.