An employee who is married and has two children submits a W-4 form to his employer indicating that he is single and claims zero deductions. Is this action ethical, unethical, or illegal? Explain your reasoning.
2007-07-16 14:04:48 · 17 answers · asked by Anonymous in Politics & Government ➔ Law & Ethics
It is not unethical, not illegal. It is a perfectly legitimate way to send extra money to the government without having to write a huge check in April. If you bothered to read the instructions for a W4, you would know this is a tax planning strategy and nothing more. My reasoning is because I have read the W4 and understand the purpose and reasoning and laws behind it. I know that it has nothing to do with your marital status, but with how much you expect to owe in taxes.
I can't help but wonder why you would care what someone claims on their W4.
2007-07-16 14:13:09 · answer #1 · answered by lcmcpa 7 · 6⤊ 0⤋
As federal withholding is greater for an employee claiming single and zero, than for a married individual with children, this W-4 presents no ethical or illegal actions. Because the company can have no idea of an employees other income & tax needs, the IRS could care less if an employee has his employer withhold more taxes than his filing status allows. In the reverse though, it becomes a problem, as you would be underwithholding. Also, the IRS must be notified if an employee claims more than 9 exemptions on his W-4, otherwise the IRS never even sees an employee's W-4.
2016-05-19 21:55:11 · answer #2 · answered by ? 3 · 0⤊ 0⤋
no its not unethical or illegal. he is arranging for his tax withholding to ensure that he will probably get a refund at the end of the year. If his wife makes more than him he has to do this to avoid owing. Some peope use this as a forced savings account. The government actually comes out ahead since they in practice borrowing his money interest free
2007-07-16 14:09:03 · answer #3 · answered by Anonymous · 3⤊ 0⤋
Perfectly ethical. He is just putting away more of his own funds in the US treasury as a 0 percent paying savings account.
It does not change the employers contribution at all to the Government, so he is not stealing.
2007-07-16 14:07:54 · answer #4 · answered by lovingdaddyof2 4 · 3⤊ 0⤋
Sure it's legal. If you want to pay the single rate and take no deductions that okay. That works to the governments favor. They will have your money and you will need to file to get a refund. The employee is only screwing himself.
2007-07-16 14:08:25 · answer #5 · answered by Anonymous · 2⤊ 1⤋
It does not matter what you put on your w-4 form. You can claim 16 dependents if you want to. When you file your income tax then you must file your actual situation. Some people do this in order to have more taxes taken from their salary so they don't have to pay the big lump sum on April 15th. It's perfectly legal.
2007-07-16 14:10:27 · answer #6 · answered by Anonymous · 2⤊ 2⤋
As far as I know, you can claim anything you want on a w-4 form. HOWEVER, if you dont claim proper withholding, you may owe the government big-time at the end of the year.
2007-07-16 14:09:59 · answer #7 · answered by ruadisneyfan 3 · 1⤊ 1⤋
You can legally submit anything you want on your W-4 form. It's what is submitted on a persons 1040 what counts.
However your employee should at least count at three of his five dependents. imho..... he is allowing the IRS to use his money for at leas a year.
2007-07-16 14:08:39 · answer #8 · answered by ♥♥The Queen Has Spoken♥♥ 7 · 1⤊ 2⤋
THIS IS LEGAL! YOU JUST WILL HAVE MORE MONEY WITH HELD FROM HIS PAYCHECK AND AT THE END OF THE YEAR WILL GET A LARGER AMOUNT BACK. IT'S LIKE A SAVINGS ACCOUNT KIND OF THAT YOU CAN'T GET A HOLD OF UNTIL YOUR REFUND COMES.
2007-07-16 14:10:43 · answer #9 · answered by Anonymous · 1⤊ 0⤋
I don't think this is illegal. It might just make a big difference on your taxes--either that too little is held out, or two much. It would be too much held out, right?
2007-07-16 14:08:39 · answer #10 · answered by Vaughn 6 · 1⤊ 1⤋