Assistance Needed with W-4 Form Completion and Tax Withholding

[Debasmita]

My husband and I recently filled out our W-4 forms for the first time. He is a traveling respiratory therapist who started his new position in April. Previously, he was a full-time employee at a hospital and earned less than I did. However, as a traveler, he now makes more than I do, but his income varies with each contract. I am a salaried full-time employee and will also be working a second job from August 2024 through December 2024.

When I completed my W-4 for my primary job, I only had the option to select or not select Box 2c. Since we do not have any children or dependents, we selected "Married Filing Jointly" and signed the forms. Did we complete the W-4 correctly? If not, how should we fill out our W-4s to ensure the correct tax withholding? 

[Cindy4]

Married filing jointly and checking box 2(c) with two incomes is appropriate.  However, this may still lead you to a tax bill at the end of the year, due to the IRS widening the tax brackets for 2024, and with the varied income.  I'm not sure why you wouldn't have had the option to complete step 2(b) along with the worksheet on your W-4.  This is a link to the most recent version of the W-4 that you could use to work through the worksheet for 2(b) to determine the appropriate extra withholding to enter in step 4(c), if needed. 

https://www.irs.gov/pub/irs-pdf/fw4.pdf

Alternatively, you can use this TurboTax Withholding Calculator to guide you through some basic questions to arrive at any potential withholding required.  

Hope this helps!

Cindy

[Terri Lynn]

Hello Debasmita!

Determining how to fill out your W4 can be difficult at times, especially when it involves more than one job or different sources of income.  

 The first thing I would like to clarify, is that  you may choose to elect to withhold as a single person, even though, you are married and filing joint, as your exemptions and filing status, do not need to match what is going to be on the actual tax return. Many married filing joint couples need to withhold at the higher single rate, especially in cases where  both  work and have no dependents or  fewer deductions. However when filling out the W-4, I would recommend to carefully review the multiple  income section, in step 2  and the optional adjustments section in Step 4.

You mentioned your spouse is now paid as a traveling respiratory therapist and as such, is paid  varying amounts based on different contracted assignments.  In this case, he is  most likely to be considered a contracted employee and will be  issued a 1099 NEC form at the end of the year, instead of a W2, as it will be treated the same as self employment income.  If that is the case, then he will want to make quarterly estimated tax payments throughout the year ,based on his actual earnings after, unreimbursed expenses, to cover the additional self employment taxes, as well as, income tax.

Here are some links to additional information and tools you may find useful:

W4 and Withholdings

• Tax Withholding Estimator
• TurboTax's W4 Calculator  
• How to Estimate Federal Withholdings 

 Quarterly Estimated Payments

• A Guide to Paying Quarterly Taxes  
• Estimated Taxes: How to Determine What to Pay and When 

Thank you for joining us today and have a great rest of your day!
Terri Lynn, EA

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