We at eFile.com understand that the Form W-4 can be confusing in determining the correct tax withholding. As a result, we have created various free estimators and tools to help taxpayers complete a W-4 online without having extensive tax knowledge. Are you starting a new job, or has your life, income, etc. changed compared to last year? If so, find the W-4 answers here.
You have two options to create a W-4. The Form Creator guides you through just filling out a Form W-4 without additional calculations. Use the PAYucator to enter your paycheck information; your W-4 will be created based on that. Make adjustments based on your tax goal.
The tax refund you may have received with your last tax return is not free government money but, in most cases, the result of too much paycheck tax withholding. In other words, it's your money. Keep more each paycheck by optimizing your tax withholding via Form W4. Use this extra money now and pay off debts instead of giving up this money interest-free to the government, only to get it back in the form of a refund check next April.
What does a Form W-4 look like?
A new W-4 is released in January every year for the tax year. That does not mean you should complete a new W-4 each year. See the image below,
click and view, and download Form W-4 as a PDF file.
Click on the image to enlarge.
What does W-4 stand for?
A pack of 4 waffles, or a brand of washing machines, or a herd of four warthogs?
Well, it's none of the above. It has to do with IRS paycheck tax withholding, and it's most likely that the "W" in W-4 stands for "withhold" or "withholding" (to take out), but we do not know what the "4" means in W-4.
What does a Form W-4 do?
A W-4 determines a taxpayer's IRS Tax Withholding amount for a given paycheck and pay period. The W-4 form is a tax withholding planning form. Thus, you have some flexibility in managing your tax withholding goals. For example, on the date you prepare the W-4, your filing status might differ from when you prepare your tax return next year. Thus, you can plan for this change now via your W-4. You can increase
tax deductions to reduce your tax withholding.
When should you complete a new Form W4?
A: At the beginning of a new job.
B: When your life has changed or will change, e.g., you might get married or divorced by the end of the year.
C: You can claim a dependent on your next tax return.
D: Your total taxable income for the year might change, e.g., decrease or increase.
Important: You do not have to wait until any of the events B, C, or D take place, but you can complete a W-4 in preparation for these events, as they might change the results of your next tax return.
Is this the way you feel?
"I've been afraid of owing taxes when I file, but then I also get scared that I withhold too much taxes each paycheck. As a result, I always withheld too much in taxes that resulted in a refund."
Sam in California
How often can you complete and submit a Form W-4?
At any point or as often as you wish during your employment.
Most of the time, a W-4 is submitted at the beginning of any new job or employment.
Update your W4 form as the result of a life-changing event: marriage, divorce, change of dependents, expected increase or reduction of annual income.
Will the form W4 provide the actual tax withholding dollar amount for each pay period?
The form itself will not provide this. You can, however, use the eFile.com
Paycheck-based W-4 calculator to find out what your IRS tax withholding would be based on your W-4 entries, e.g., filing status, dependents, deductions, etc.
Or, you monitor your first paycheck after you have submitted the new W-4 form to your employer.
Even if you know the per-paycheck tax withholding amount, you do not know how it would affect your tax return. For that, we suggest you use the
Tax Return Estimator and enter the annual paycheck-based tax withholding amount and your annual income, and you can estimate if you can expect a tax refund or if you might owe taxes.
How do you know what to enter on a W-4?
Taxpayer employee information: Name, Address, SSN, Signature, and Date.
Tax return-related information: Filing status, number of Dependents or other Dependents, Deductions. Click on each link to learn more about each field. Remember, the W-4 is a planning tool, and if you complete the form during the year, you could enter the information that might apply to you by the end of the year. For example, you might not be married when you complete the form, but you might be married by the end of the year; thus, you would file your tax return under the filing status married. The same might apply to Dependent(s) or Deductions.
Use any of these W-4 tools:
W-4 Creator,
Paycheck-based W-4, or
Tax Return Estimator.
How to complete a W4 between now and the end of 2023.
Example: Your 2022 Tax Return showed a $1,200 refund, and your 2022 income and deduction situation is not changing. Take a look at your last paycheck, take the tax withholding amount, and decrease your withholding by $200 (monthly pay period) or $100 (bi-weekly pay period) between the remaining months of May through December 31. As a result, you should get a smaller refund in 2023 and not owe taxes but increase your paycheck per pay period. Do the reverse if you owe taxes on your 2022 Tax Return.
How do you know if you withhold too much or too little tax withholding?
Step 1: At any given time in the year, take all your pay stubs (including your spouse) and add up all the federal tax withholding year-to-date.
Step 2: Add up all other federal tax withholdings YTD and IRS estimate payments you made YTD.
Step 3: Based on Step 1 and Step 2 estimates, add up the remaining IRS tax withholdings for the remainder of the given year.
Step 4: Add up Step 1 + Step 2 + Step 3 = Total estimated IRS tax payments for the year.
Step 5: Use either the Income Tax Rate Calculator or the Tax Year Calculator and enter the annual tax withholding amount. As a result, you will find out if you can expect a tax refund or if you might owe taxes.
What if your paycheck tax withholding amount is at zero or 0? Could you still expect a tax refund?
Where to submit a W-4 to?
A W-4 is submitted only to your employer, not the IRS or state tax agency.
Keep a copy of your latest W-4 Form per paycheck or employer for your records. Find your
state tax withholding form(s).
Where are the state-related tax withholding or W-4 forms?
Taxercise your paycheck with an eFile.com W-4-related calculator or estimator!
W-4 Creator: If, for any reason, you do not need the pay period tax withholding dollar amount and you only need to fill out or complete a W-4, then use the
W-4 Creator tool. The tool will guide you through each step, and at the end, you can sign, download, and/or email the W-4 to your employer and/or yourself.
Paycheck-based W-4 tool: If you want to estimate the actual dollar amount based on your W-4 entries, use the
W-4 Paycheck Calculator tool or PAYucator.
Tax Return Calculator: If you have various sources of income (W-2s, 1099s, Dividends, etc.), and you would like to know the required withholding amount, then use the Tax Return estimator first before you complete the W-4 based on the
2023 Tax Return Calculator results. Once you have the tax return results,
contact a Taxpert® for a free consultation on completing your W-4 form.
Income Tax Rate Calculator: For a high-level estimate of your total IRS income taxes based on your combined annual income, use this
Income Rate Calculator and use these results to complete your W-4.
State Income Rate Calculator(s): Select a
State Income Rate Calculator based on your combined annual state income. Then, complete your
state tax withholding form(s) based on the calculator results.
Talk to a Taxpert ® for a free W-4 consultation.
Tax Refund Myth and Fact!
Myth: Tax refund money is free government money or the result of "
refund boosting" by tax preparation software.
Fact: In most cases, a tax return refund is a taxpayer's money due to too much tax withholding or insufficient tax planning by taxpayers. There are cases when
Refundable tax credits do "boost" or enhance a tax refund in addition to too much in IRS tax withholding.
Don't Penalize yourself with a Tax Refund!
Don't do what too many hard-working taxpayers do. They withhold too much in taxes per paycheck. This self-imposed penalty could cost you up to 18% of your yearly income. Yes, it's self-imposed due to insufficient taxpayer planning.
Learn more about self-imposed penalties.
Click the link on your left and follow these steps throughout the year. Or use these simple tax calculators to estimate your income tax return with up-to-date information. These figures will be reported when you file your tax return on eFile.com. The eFile Tax App will report your situation on your return based on your answers to straightforward tax questions.