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How much W4 withholdings for this year?
Posted on 7/8/21 at 7:59 pm
Posted on 7/8/21 at 7:59 pm
Started a new job and w4 withholdings are a dollar amount. Both me and the wife have good jobs. The paper form says multiply each dependant by $2000. Is this a good starting point? I know they're are multiple calculators on the internet, but I've haven't had much luck completing one without getting pissed off
1
Posted on 7/9/21 at 6:24 am to lsuguru
I’d take your tax obligation from last year, subtract what your wife withholds annually, then divide the remainder by 26 (the number of bi-weekly paychecks you get in a year).
That way you’ve allotted for the same amount of money you paid in taxes last year.
Now there’s probably only 10 pay periods left this year, so if you haven’t been withholding, you need to adjust accordingly if you haven’t been withholding enough to-date. You can easily take the number you calculate above and compare it against your last pay stub to see where you should be at the mid point of the year.
That way you’ve allotted for the same amount of money you paid in taxes last year.
Now there’s probably only 10 pay periods left this year, so if you haven’t been withholding, you need to adjust accordingly if you haven’t been withholding enough to-date. You can easily take the number you calculate above and compare it against your last pay stub to see where you should be at the mid point of the year.
Posted on 7/9/21 at 6:36 am to TDFreak
The above assumes nothing has changed in you and your wife’s financial picture including no more kids or other new tax breaks or obligations.
It works well especially if you have to put down an actual dollar withholding figure like you said instead of calculating dependents (I always fill those out exactly and I am usually way off one way or the other come filing day). Plus your spouse’s W-4 then comes into play.
Any additional payroll income over last year can use a simple 20%-25% withholding tax assumption to each extra dollar. You’ll be in the ballpark.
I’m also assuming your not changing how much you are putting in tax sheltered accounts like 401Ks, HSAs, 529 plans, etc.
It works well especially if you have to put down an actual dollar withholding figure like you said instead of calculating dependents (I always fill those out exactly and I am usually way off one way or the other come filing day). Plus your spouse’s W-4 then comes into play.
Any additional payroll income over last year can use a simple 20%-25% withholding tax assumption to each extra dollar. You’ll be in the ballpark.
I’m also assuming your not changing how much you are putting in tax sheltered accounts like 401Ks, HSAs, 529 plans, etc.
Posted on 7/9/21 at 6:37 am to TDFreak
This doesn't help OP - but is it common for people to have to state a specific $ to withhold? Every job I've had always used some formula to do withholdings and I could raise or lower it if I chose
Posted on 7/9/21 at 6:59 am to Stateguy
quote:
This doesn't help OP - but is it common for people to have to state a specific $ to withhold? Every job I've had always used some formula to do withholdings and I could raise or lower it if I chose
Same question.
A W-4 is what it is in my experience. Dollar withholdings are an option, but not the only one.
This post was edited on 7/9/21 at 6:59 am
Posted on 7/9/21 at 8:34 am to Stateguy
quote:
This doesn't help OP - but is it common for people to have to state a specific $ to withhold? Every job I've had always used some formula to do withholdings and I could raise or lower it if I chose
They changed the forms recently. They ask for an input of total dollars withheld instead of trying to guess how many dependents to put in to make the calculation withhold what you want. The old form was retarded.
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