We just had our first child born April 23rd of this year and I'm considering making a change to my W4 to take home more from each paycheck. I am paid monthly and have been moved from an hourly position (last year) to a fixed salaried employee so there's no variation in month to month pay going forward. As like most folks I live paycheck to paycheck so owing the IRS is NOT an option. Thanks in advance for any help.
Whenever you have a major personal life change your W4 should be updated. We recommend using a tax calculator to make sure you are withholding enough from you paycheck, based on your income and deductions: W-4 Calculator 2024
Congratulations on your new tax deduction! You are very welcome - thanks for joining our Event today, Tim Cox!
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Congratulations to you for your new born baby!! Yes, you can change your W-4 to take home more forr each paycheck. You can adjust your W-4 at any time during the year. Just remember, adjustments made later in the year will have less impact on your taxes for that year. The links below give you guidance on adjsuting W4 withholding.
https://www.youtube.com/watch?v=Li7ybmBGyj8
https://turbotax.intuit.com/tax-tools/calculators/w4/
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Hi Tim!
Congratulations on the new baby! You're probably aware that parents can claim the Child Tax Credit of $2,000 per child, up to age 17. After age 17, the credit drops to $500, as long as they are still your dependent.
The Form W-4, Step 3 is where you would update the form to indicate you have a child under age 17. If you indicate you have a child, your withholding will be lower, expecting that you will claim the child tax credit.
Since you absolutely don't want to owe taxes when you file, you'll want to consider your overall tax situation to be sure you have enough withheld throughout the year. If your spouse works, you'll want to follow the guidance on the Form W-4, Step 2. When both spouses work, it's important to have sufficient withholding to avoid owing taxes with the tax return.
Sincerely,
Kimberly, CPA for over 30 years