during the year i claim 0 with my job should i claim 1 so i can take home more $, does it pay to claim 0?
2007-03-02 11:38:07 · 6 answers · asked by Lepke 1 in Business & Finance ➔ Taxes ➔ United States
Take your most recent paycheck stub and go to the IRS wesite, Using the figures on the pay stub and the withholding calculator at the site, will help determine the best way to compute what you should be claiming on your W4
http://www.irs.gov/individuals/article/0,,id=96196,00.html
2007-03-02 11:43:13 · answer #1 · answered by Anonymous · 1⤊ 1⤋
That would depend on your ability to budget. If you find that you use the tax refund to pay bills that have piled up, then just consider your refund a mandatory savings system. If, on the other hand, you don't overspend and can use the money during the year you may want to claim 1 deduction.
It might be a good idea to put the extra money in a savings account or money market. This way you can earn interest on it as well. Why let the government make money on you?
2007-03-02 19:47:59 · answer #2 · answered by Lorrie C 2 · 0⤊ 0⤋
It doesn't pay to claim fewer allowances on your W-4 than the number that will allow you to break even at tax time. A refund is just that - giving you back your own money that you'd have had earlier in your paychecks if you hadn't had extra withheld.
If you want a huge refund, have them take out an extra $100 each week - there's a place on the W-4 form to have extra withheld. Then you'll get that extra $5200 back in your refund at the end of the year.
Doesn't sound like a good idea? I didn't think so.
2007-03-03 13:00:23 · answer #3 · answered by Judy 7 · 1⤊ 1⤋
Assuming you are single and are paid every 2 weeks and using $36,000 as your income, claiming zero allowances comes to $172 withholding per check. $1000 refund comes to $38.46 per check. That would mean you should have $133.54 withheld per check. Claiming 3 allowances would result in $140 withholding. Claiming 4 allowances would result in $131 withholding. The IRS also provides an on-line calculator to determine how many allowances to claim.
The links below are the withholding tables and the withholding calculator.
2007-03-02 20:24:56 · answer #4 · answered by STEVEN F 7 · 1⤊ 1⤋
it depends on if you want to give the government an interest free loan of $1000 each year.
I have no idea if claiming 1 will do to your situation.
2007-03-02 19:43:30 · answer #5 · answered by ? 4 · 0⤊ 1⤋
Yes, you shouldn't make interest free loans to anyone. This includes the government who will definitely charge you interest if you were late.
2007-03-02 19:43:22 · answer #6 · answered by Nelson_DeVon 7 · 0⤊ 0⤋