When both spouses work and you're putting 0 exemptions on your federal W4 with an additional amount withheld, should you put the same thing on the state W4?

[Nicole-T]

Should you replicate the exemptions and additional amount withheld on your state W4 as your federal W4 when both spouses work full time?

[ChelsiE2]

There is no rule that requires you to report the same amount of exemptions on your Federal and State W-4 forms.  By entering zero on both of these forms, you will have a higher amount withheld from your paycheck.  If you'd also like to have a higher amount withheld from your paycheck for state tax purposes, then you should also enter a zero on the state form.

You can talk to your human resources department to verify the exact amount that will be withheld for certain exemption numbers reported on Forms W-4.

[Nicole-T]

Thank you for your prompt response!

[Nicole-T]

I wish there was a worksheet for the Michigan W-4 like there is for federal W-4 regarding two-earners to figure out how much additional income, if any, I should have taken out for each payroll.  I found out that 4.25% of gross pay should be withheld and for my bi-weekly pay and 0 exemptions, there will be $51.26 taken out per pay period.  How do I know that will be enough taken out with my husband having 4 exemptions on his state W-4 in order to avoid owing taxes?

[ChelsiE2]

@nicoletennenhous Are you saying that you calculated $51.26 of state or federal taxes will be withheld from your paycheck?

[Nicole-T]

I got that number from the Michigan Income Tax Withholding Tables available on the Michigan website.  That's the amount of income tax withheld for 4.25% of gross pay withheld with 0 exemptions on more than $1,206 amount of bi-weekly pay per payroll period.

[ChelsiE2]

@nicoletennenhous It's likely that your husband won't have much taken out at all with four exemptions.  If you estimate that your joint Michigan tax liability will be greater than $1,230 ($51.26 x 24) then you should have your husband change his W-4 to lower his exemptions.  It's always better to overpay a little than to owe big time.  If you end up with a huge refund next year then you'll know you have some flexibility in the future and can adjust your W-4s accordingly.

[Nicole-T]

OK, thank you!!