What Should I Put on My W-4 for Tax Withholding?

Form W-4, the Employee’s Withholding Certificate, is a document you provide to your employer. It dictates the amount of federal income tax to be withheld from your paycheck. The primary goal is to ensure that the amount of tax paid throughout the year is as close as possible to your actual tax liability. Accurate withholding helps you avoid a large tax bill or penalty at tax time, while also preventing you from giving the government an interest-free loan in the form of a large refund.

The form allows you to account for various personal financial factors to tailor your withholding, including your filing status, number of dependents, and other sources of income or tax deductions. By correctly completing the W-4, you instruct your employer on how to calculate the appropriate tax for each pay period, which directly impacts your take-home pay.

Information Needed to Complete Your W-4

Before you begin, gathering the necessary documents will streamline the process. You will need the Social Security numbers for yourself, your spouse, and any dependents you plan to claim.

You should also have a clear understanding of the tax filing status you intend to use, as this choice significantly affects your standard deduction and tax rates. For an accurate calculation, have your most recent pay stubs available, especially if you or your spouse have multiple jobs. These documents provide your year-to-date earnings and current withholding amounts.

Additionally, referencing your most recent tax return can help you estimate non-wage income, such as interest or dividends, and identify potential deductions like student loan interest or contributions to a deductible IRA.

A Step-by-Step Guide to Filling Out Form W-4

Enter Personal Information

Step 1 of the Form W-4 is for your personal details, where you will enter your full name, address, and Social Security number. This section also requires you to select your anticipated tax filing status: Single or Married filing separately, Married filing jointly (or Qualifying widow(er)), or Head of household. For 2025, the standard deduction is $30,000 for Married Filing Jointly, $22,500 for Head of Household, and $15,000 for Single and Married Filing Separately filers. If you are single, have one job, no dependents, and no other income or deductions, you may only need to complete this step and sign the form.

Multiple Jobs or Spouse Works

Step 2 is for employees who hold more than one job or are married filing jointly and their spouse also works. You have three options to complete this section, but you only need to choose one. The most accurate method is using the IRS’s online Tax Withholding Estimator tool. This tool provides a precise withholding amount to enter on the form and is particularly useful for those with self-employment income.

A second option is to use the Multiple Jobs Worksheet, which is included on page three of the Form W-4. You would complete this worksheet and enter the resulting additional withholding amount in Step 4(c). This method is less precise than the online estimator but does not require you to share details about other income with your employer. The third option is to check the box in Step 2(c). This option is best for households where there are only two jobs with similar pay, and the box must be checked on the W-4 for both jobs, which tells the payroll system to cut the standard deduction and tax brackets in half for each job.

Claim Dependents

Step 3 allows you to account for tax credits for dependents, which will reduce the amount of tax withheld from your pay. If your total income is $200,000 or less ($400,000 or less if married filing jointly), you can claim credits for your children and other dependents. You will multiply the number of qualifying children under age 17 by $2,000 and the number of other dependents by $500, then add these amounts together on line 3.

A qualifying child must meet specific criteria, and other dependents, such as an elderly parent or a college student you support, may also qualify you for a credit. If you are married filing jointly, only one spouse should claim these credits on their W-4 to ensure withholding accuracy. These adjustments should be made on the W-4 for the highest-paying job.

Other Adjustments

Step 4 provides an opportunity to fine-tune your withholding. Step 4(a) is for other income not from jobs, such as interest, dividends, or retirement income. Including this income here helps ensure taxes are withheld for it, avoiding a potential balance due when you file your return.

Step 4(b) is where you can account for deductions you expect to claim. If you plan to itemize deductions rather than taking the standard deduction, you can use the Deductions Worksheet on page three of the W-4 to calculate the amount to enter here. This can include deductions for state and local taxes, mortgage interest, or charitable contributions. Step 4(c) allows you to specify any extra tax you want withheld from each paycheck, which can be useful for covering self-employment income or to receive a larger refund.

Sign Here

You must sign and date the form in Step 5 to make it valid. Without your signature and the date, your employer cannot process the form. Your withholding will then be calculated based on default rules, which may not be accurate for your situation.

Submitting Your Form W-4 to Your Employer

Once you have completed and signed your Form W-4, submit it to your employer’s human resources or payroll department. Many companies now use online HR portals that allow you to fill out and submit the form electronically. If an online system is not available, you will provide a physical paper copy.

After submission, you should see the changes in your tax withholding reflected in your paycheck within one or two pay periods. It is good practice to review your first pay stub after the change takes effect. Verify that the federal income tax withheld aligns with the adjustments you made on your new W-4. If the amount seems incorrect, follow up with your HR or payroll department to ensure the form was processed correctly.

When to Update Your W-4

You should update your Form W-4 whenever you experience a significant life event that impacts your finances. Keeping your withholding current helps ensure you are not overpaying or underpaying your taxes.

You should submit a new W-4 for events such as:

• Getting married or divorced, which will change your filing status.
• Having or adopting a child, which makes you eligible for new tax credits.
• A dependent no longer qualifying as your dependent.
• Changes in employment for you or your spouse, such as starting a second job or a spouse starting or stopping work.
• Receiving a substantial amount of non-wage income, like from a side business or investments.

The IRS recommends using their Tax Withholding Estimator tool annually and any time your circumstances change to check if your withholding is accurate. Submitting a new Form W-4 ensures your paychecks reflect your current financial reality.