Hi tax experts! Thanks for hosting this event!
My husband and I filed jointly last year and owed about $1600 federal. We each have one income.
Since then, he has received a substantial salary raise and it is clear we need to refile W4's with each of our companies. We make about the same salary.
We cannot figure out how much extra to withhold to make sure we do not owe again next year. Actually, we are quite stumped on the entire W4 document to be honest!
Would appreciate any insight you can provide since it seems time of the essence. Thank you!
I know the W-4 can be confusing. Here are some tips for you when filling it out. Also there is a calculator link provided, so you can see your amounts too.
By placing a “0” on line 5, you are indicating that you want the most amount of tax taken out of your pay each pay period. If you wish to claim 1 for yourself instead, then less tax is taken out of your pay each pay period.
If you have 2 or more jobs -
When filling out your W-4 forms, there are a few tips to keep in mind: For the job where you make the most money, claim all of the allowances you normally would on the W-4 form. For any other job that you have (your second job for example) claim zero.
If you want to owe the least amount when filing your taxes, you will claim 0 on the W-4, so the job will withhold at a higher rate. This is important especially if you have more than 1 job.
If you didn't account for each job across your W-4s, you may not have withheld enough, so your tax refund could be less than expected.
Calculator - https://apps.irs.gov/app/tax-withholding-estimator
Instructions - https://www.irs.gov/pub/irs-pdf/fw4.pdf