The past few years have been a rollercoaster ride when it comes to getting your tax refund check from the IRS. If I told you there was a way for you to get that money when you make it, each and every pay period, would you believe me?
Well, there is and it’s a simple change to your withholding amount on Form W-4.
To increase your paycheck, claim more allowances to withhold fewer taxes each pay period. Here’s how.
- Use the withholding calculator to help you complete a new Form W-4 for your employer.
- Adjust line 4c, called extra withholding, which adds additional withholding to each paycheck.
It’s a best practice to update your W-4 whenever there is a major, personal life change, like getting married/divorced, the birth/adoption/death of a child, dependents age out, unemployment, second job, or your spouse changes or getting a job.
Should I put a 1 or a 2 on my Form W-4?
If you’re a single person who lives alone and has only one job, place a 1 in Part A and B on the Form W-4 worksheet for a total of 2 allowances.
A married couple with no children and both having jobs should claim one allowance each. Us the “Two earners/multiple jobs” worksheet on page 2.
Part E of the worksheet is for those who claim head of household. Head of household may only be claimed if you are unmarried and pay more than 50 percent of the costs of keeping a home for yourself or dependents.
A married couple may combine incomes and file a single, joint account. For example, a single breadwinner should claim 2 allowances and file a joint tax return.
If you have children, you may be able to claim them as dependents on part D. They must be residents, under age 16, not providing 50 percent of their own financial support, and live with you.
Remember, if you’re in doubt, contact me to help you plan your tax strategy to keep more money in your paycheck and less for the IRS.