I need help filling out W-4 form so that I get more money from my paychecks and pay less tax. Recently my circumstances have changed, I am married and have 1 child (2 months old), only I work my wife does not work and my income is $92,000/year and get paid every 2 weeks.
Below is the screenshot of my attempt, but not sure if these numbers apply, I don't want to owe anything at the end of the year, I want to either break even or get refund. Any help is appreciated and thank you.
In this situation I would recommend figuring out about what you would need to pay in taxes for the year. You have two figures (your salary and dependents) , but not others. Will you contribute to a 401K, do you itemize deductions, etc... If things are uncertain, I would figure my taxes as if I took the standard deduction.
For argument's sake let's assume that comes out to $7300. I would then add $500 on to my total to cover potential increases in taxes/fees. You can adjust this up or down based on your ability to absorb having to pay or the uncertainty in your first calcuation.
So now $7800, divide by 26 (the amount of paychecks you receive in a year) = $300
Then I would utilize a payroll calculator to adjust my exemptions and additional witholding so my federal withholding is as close as possible to this number.
Or you can sit with your payroll department and do the same.
First, I'd use an online tax calculator to figure out you total tax tab for the year. Then look through Circular E and figure out from there how much tax you should pay for the rest of the year and work backwards to calculate the number of allowances to get there.
Two friendly warnings -
Since you are doing this midyear, you'll need to repeat this exercise as we go into 2017. These next 6 months, you'll be withholding less than normal to make up for the high holdings so far.
Second, a withholding is like saying tax/don't tax me on $4050. So in the 25% bracket, it's +/- $1000 in tax paid. You can adjust closer via the line 6 on W4 'additional withholding'.
