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We recently became married and we will soon be filling out a W-4 and submitting it to our employers. The question on my mind as we're filling out the W-4 is, should we be submitting a new one on Jan 1st next year since we're submitting one now part way through this year?

The reason from my question comes from line 9 of the "Two-Earners/Multiple Jobs Worksheet" on page 2. It says:

Divide line 8 by the number of pay periods remaining in 2013. For example, divide by 25 if you are paid every two weeks and you complete this form on a date in January when there are 25 pay periods remaining in 2013. Enter the result here and on Form W-4, line 6, page 1. This is the additional amount to be withheld from each paycheck

To me, the part about "pay periods remaining in 2013" sounds as if our paychecks will be adjusted so that our withholdings are extremely low for the rest of the year and for 2013 we will have a $0 tax bill. If that's true, then I wonder if our withholdings will stay low for 2014 and if we don't change anything we'll end up owing alot for our 2014 taxes. Is this true? Should we file new W-4's now and again at the beginning of next year?

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You should file one now, calculating based on the current situation. Then, at the end of the year, recalculate, and only file if changes are needed.

Not filing now means you continue withholding at the single rate, and will basically be paying much more than you should. You'll get it all refunded of course, but why give interest free loans to the government?

  • 1
    "why give interest free loans to the government?" Ditto that, I want to avoid that for sure. – butallmj Oct 1 '13 at 1:04
  • The relevant part of the instruction is: Divide line 5 by the number of paydays (or other withholding events) remaining in 2013 and enter the result. This is the additional amount you should have withheld from each remaining payment. Enter this amount on Form W-4, line 6 Typically this is a positive number representing the "marriage penalty". – dcaswell Oct 1 '13 at 2:54
  • To round out @littleadv's answer, the following is a message from the IRS witholding calculator at the end of the process: "Caution! The recommended number of allowances will result in no income tax being withheld from your pay (because your year-to-date withholding is already sufficient to meet your anticipated tax). Therefore, you should analyze your withholding again at the beginning of 2014 (or any time there is a change to your tax situation). If you do not check your withholding at the beginning of next year, you will likely be underwithheld for 2014." – butallmj Oct 7 '13 at 0:12
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Don't forget to change/review the state version of the W-4. This is especially true if one or both are also moving to a new state with the marriage.

You should make it a habit to review your W-4 form each spring or after each life event such as marriage, or the birth of a child.

During your annual review you may want to adjust your withholding depending on whether you got a refund or were required to make a payment when you filed your taxes. Because of changes to some deduction amounts for medical premiums, health spending account, or retirement the taxable amount for the year might change significantly.

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