My spouse and I earn about the same amount. My federal withholding is double what was withheld from his paycheck. He has 0 allowances and filing status for federal is Married, filing jointly. He does have 401K contributions which are about 13% of his pay. This year we have to pay a large amount back and most of this appears to be caused by how little is being withheld. Could this be an error on the part of the employer or do we need to update his federal filing status so we aren't hit next year with having to pay so much money back?
Yes, you need to update your W-4 with the employer. You can choose to use Single since the incomes together are creating a higher tax bracket, or use the method below without changing any selections on your W-4 as it is right now. You are allowed to change your W-4 as many times as you like during the year and your employer(s) must make the requested changes.
If you believe you will earn approximately the same amount then you can make an easy change to the W-4 for your spouse.
You can decide to increase it or decrease it but this amount will put you very close to even for your 2024 tax return without having an excess amount of withholding. It's important to note this amount will reduce your current net pay each pay period.