W-4 Number of Allowances

Jul 18, 2007 2 Replies
B

I have a summer job (3 months) that has a good pay. I will be earning around $17,000 in the 3 months, and according to the federal tax rates, I should pay about $850 as tax. In my W-4, I presently claimed 3 allowances, all of which apply to me (I am a single, by the way). However, I had $410 federal tax withheld from my first paycheck of $2,700. That is almost half of the total that I will need to pay! I understand that they calculated for the entire year as opposed to 3 months, in which case the withheld amount is okay. Is there any way to reduce the withholding legally (I don't want to get into any trouble being a foreign citizen!)? What about increasing number of allowances; can it be done, and up to how many if so? Help would be greatly appreciated!



Thanks



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S

Yes: file more than 3 allowances.

If you file the number that leads to the correct amount of tax withholding, everybody is happy. Seth

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J

The way the withholding worked, it's as though you were going to make $68,000/yr, in which case the $410 is $10,660/yr in tax and loking at

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you owe about$11200, so you'd get owe a bit. But, as you note, you will only make $17,000, and after std deduction/exemption, have a taxable income of $8250, and total tax due of $846. It would take 20 allowances to drop your withholding to 0. But by the time you get a new W4 in, you'd have paid another $410. As long as you pay more than 90% of the tax due for the year, and then the rest in April, there is no consequence to claim those allowances. Don't confuse allowances with the claiming of dependents who aren't yours, the first is the right way to adjust withholdings, the second is just plain illegal. JOE

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