What are withholding allowances?
Each withholding allowance you claim reduces the amount of wages subject to federal income tax withholding. There is a worksheet provided on the W-4 form that allows you to figure out the number of allowances you can claim. It is important to note that allowances on the W-4 form and exemptions on your tax returns are not the same. You may be entitled to more allowances than exemptions or vice-versa.
Withholding Allowances are claimed using a W-4 form. For each withholding allowance claimed, the employee reduces the amount of wages subject to federal income tax withholding. Here is a list of withholding allowances, which employees are allowed to claim: • One for the employee unless he or she can be claimed as a dependent by someone else. • One for the employee’s spouse if working and claiming an exemption for himself or herself. • One for each dependent to be claimed on the employee’s personal tax return (other than the employee’s spouse). • An additional allowance if the employee is single with one job (or has a second job paying less than $1,000 per year) or married with one job and the employee’s spouse does not work (or earns less than $1,000 per year). • An additional allowance if the employee’s tax filing status is head of household. • An additional allowance based on the employee’s itemized deductions and income adjustments. • An additional allowance if the employee has at l
Related Questions
- The amount of federal income tax withheld from employees’ paychecks depends on their marital status, the number of withholding allowances (exemptions) they claim on Form W-4, and their projected annual income Q: What is Federal Unemployment Tax (FUTA)?
- Where can I get information to assist me in determining what number I should enter in regards to the number of exemptions/withholding allowances for state tax purposes?
- How is the number of employee withholding allowances determined?
