Should we change withholding allowances?

[bibi671]

Our witholding allowances for 2018 were 7- Married, filing jointly, 2 children and 2 jobs. As of last week, I am no longer working, and we want to adjust our withholding allowance- According to the IRS  calculator, it should be 5 based on the new info.  If we take it down to 4, will we be loosing a large chunk from our one remaining income? Thanks. 

[MichaelMc · Accepted solution]

You really should get in the habit of providing your employer(s) with a new Form W-4 early each year. It is a good way to review your family financial status and withholding allowances and be certain that your employer is taking the correct withholding from your pay.

In your present circumstances, and in light of the recent changes in tax law, an update to your W-4 is definitely in order.

You might wish to use the TurboTax withholding calculator to verify your ideal withholding allowances.

https://turbotax.intuit.com/tax-tools/calculators/w4/

I am not comfortable recommending whether you should adjust down to four allowances, as I just don't know your financial obligations. I would not want to see you have too much taken from your one remaining income at a time when you are adjusting to new circumstances.