2007-02-06 21:49:53 · 5 answers · asked by deonne626 1 in Business & Finance ➔ Taxes ➔ United States
You can put any amount you want to, but remember that when you have to do your taxes you may end up having to PAY. I use to just have my employer take EXTRTA out in my Federal. and that way I was sure to get a refund. If you save the money through the year by claiminmg extra deductions it does no good IF you have to pay at the END of the year.
2007-02-06 21:58:39 · answer #1 · answered by Ex Head 6 · 1⤊ 0⤋
Technically you can put as many as you want. But then you should know the consequences. There is no "free lunch". What you get now might be what you pay at the end of the year and - one would hope not - perhaps a penalty. IRS can/will penalize you for not witholding enough.
In addition, depending on where you work (self employed or working in an establishment), I am not sure if the HR allows you to deduct arbitrarily. At least in the past I have not seen any scrutiny for my W4s, but then I always used appropriate number of exemptions.
Ideally speaking you should balance the number of exemptions so your tax refund or tax payment when you file the taxes is a small amount.
2007-02-06 23:10:20 · answer #2 · answered by Sai P 3 · 0⤊ 0⤋
As a Payroll manager I can tell you that I am required by law to receive documentation (ie-birth certificates) of any exemptions that I feel are excessive.
If I remember corretly the law states I have to send the W-4 to the IRS if the employee claims 10 or more exemptions. You don't want that to happen.
Whatever you do make sure you don't end up paying next year. The IRS decided a few years back that underwitholding on your paychecks is a crime and you can get a penalty assessed.
2007-02-06 22:52:14 · answer #3 · answered by Gem 7 · 0⤊ 0⤋
You've got a bit of a misunderstanding. The higher the number on your W-2, the less money they will withhold. That has NOTHING to do with how much tax you'll actually owe. Most people keep those numbers low so that more is withheld. That way, they won't end up with the unpleasant surprise of owing taxes at the end of the year. The upside is that nice chunk of change we like to call a tax refund! :)
2016-05-24 02:29:13 · answer #4 · answered by Anonymous · 0⤊ 0⤋
More than you currently are.
2007-02-06 22:31:14 · answer #5 · answered by Bostonian In MO 7 · 1⤊ 0⤋