There are many reasons why you would want to adjust your W-4 form so that the maximum tax is taken out. Filling out your W-4 for maximum withholding will almost certainly guarantee you a refund, unless you have outstanding obligations, such as past-due child support or back taxes. While taxpayers who have the maximum tax taken out can expect to receive a smaller paycheck each pay period, some prefer knowing they will likely get a larger refund at tax time to use however they see fit. Adjusting your W-4 is fairly straight forward, and you can do so at any point in the year. However, the earlier you make changes to your W-4, the more impact these changes will have on your taxes.
If you want to have the maximum amount of taxes taken out of your paycheck, then you need to claim zero allowances on line 5 of your W-4.
What Are W-4 Allowances?
Your W-4 defines for your employer how much to withhold from your paycheck for federal income taxes. The more W-4 allowances you claim, the less your employer will withhold. Some people opt for this route because they’re able to take home more money each paycheck that they can use or invest how they wish. Others prefer to have the maximum withheld on their W-4 so they will receive a refund.
How Many Allowances to Claim
You are allowed one allowance for yourself, your spouse and one allowance for each of your dependents. If you file as head of household, you can claim another allowance, and even another if you plan to itemize or if you’re claiming the child and dependent care credit or the child tax credit. Keep in mind that just because you’re entitled to claim all allowances you’re eligible for, you can also opt to claim zero allowances so that the maximum tax is taken out of each paycheck.
How to Claim Maximum Allowances
Before you complete your W-4, go through the personal allowances worksheet which helps you figure out the number of allowances you can claim. Lines A – G guide you through determining your allowances based on your own personal situation. On line H, total all of the previous allowances you claimed for lines A – G. Whatever number is reported on line H is the number of allowances you can claim. However, if you want to have the maximum withheld from your paycheck, simply enter a “0” for lines A – G, and line H. If you’re unsure of whether or not you should claim zero allowances, the IRS has an interactive withholding calculator to help you determine just how many withholding you can claim, and how it affects you at tax time.
On line 5 of your IRS-Form W-4, you'll write "0" for the total number of allowances. On line 6 of the form, taxpayers have the option of indicating a specific amount of additional monies to be withheld from their paycheck. This figure is independent of the number of allowances you wish to claim. The number you indicate here is a flat dollar amount that will be withheld from each paycheck along with the number of allowances you claim. If you want additional money taken from your paycheck than claiming zero allowances affords you, you would indicate that amount on this line of your W-4.
Tara Thomas is a Los Angeles-based writer and avid world traveler. Her articles appear in various online publications, including Sapling, PocketSense, Zacks, Livestrong, Modern Mom and SF Gate. Thomas has a Bachelor of Science in marine biology from California State University, Long Beach and spent 10 years as a mortgage consultant.