is it better to claim 0 or 1 on my w4?

Question

i am single own a house and can claim my mother as a dependent

i was told it is better for me to claim 0?

i make an average of 62000 a year

Answer 1

If you claim 0, they will take out more taxes through out the year, possibly resulting in a bigger return. You should consider last years return to make your decision. If you got a big refund, you may want to claim 1 to keep more of your money during the year. You could put the difference in a savings account and earn a little interest.

Answer 2

There's no cut-and-dried answer to that. It depends upon other factors that may come in to play.

First off, how much of a refund are you currently getting? If it's a couple hundred $$$, your withholdings are just about perfect as they are and unless your situation changes significantly you should leave them as they are. You are getting the maximum amount possible in your paycheck and are not making an interest-free loan to the government.

If you are getting several thousand $$$ back each year, you're having WAY too much withheld from your pay and you need to bump your W4 withholding exemptions up some. You'll put more in your paycheck and you'll stop giving free loans to the government.

Lastly, if you have to pay more than a couple hundred $$$ at tax time you are not having enough withheld from your pay. If you're already claiming 0 on Form W4, you may need to direct your employer to take more out of each paycheck. There's a line on Form W4 for just that purpose.

The best way to figure the correct withholding exemption number for your situation is to fill out the 2 worksheets on page 2 of Form W4. This will account for all personal and dependent exemptions, itemized deductions, other income such as a second job or dividend and interest income, etc.

Lacking full knowledge of your situation, my best guess would be 3 or possibly 4, not 0 or 1. You get one each for yourself and your dependent mother. You probably get at least one more for itemizing your deductions. This all assumes that you hold only one job and have no other income such as dividends and interest or other taxable income.

Answer 3

It depends whether you are good with your money or not. I used to claim zero and get a large tax return until one year there was an error with the IRS and i didnt get my money back for 6 months, so now i claim the max so i can use MY money all year long and get interest on it if I want. Now my father is a teacher and he wants a big return so he can live off of it for the summer, so he claims zero. If you own a house you will always get money back so claim the max. you can even claim 2 or 3 if you want a lesser return.

Answer 4

If you pay hefty mortgage interest, have no other income, then put 1. You can put the increase in paycheck to a cd account and earn income on it. Putting a zero will park the money with IRS and won't earn any interest.