I just got married recently. It is just me and my wife. What should i claim on my paycheck so that I am best suited down the road. Also what should she claim. Thanks.
2007-08-01 03:30:50 · 6 answers · asked by biged140 2 in Business & Finance ➔ Taxes ➔ United States
I don't know much but I do know that claiming zero would give the government a nice interest free loan.
2007-08-01 03:40:24 · update #1
The short answer is: It depends.
The goal at the end of the year is to have withheld enough to not owe any under-withholding penalties. (this is 100% of what the two of you owed for 2006 assuming your combined adjusted gross income is under $150,000, or at least 90% of the tax that you will owe for 2007). You can do a calculation looking at your paystubs (the YTD amount w/h for federal for you and your wife plus the amount w/h per paycheck multiplied by the number of paychecks left in the year). If the w/h number you come up with is over the target, you can raise your numbers on a W-4... if it's too low, then lower your numbers, or make estimated payments.
If you have any income outside of your W-2's (from investments or partnerships, the sale of real estate, unemployment compensation etc.) don't forget to put the tax due on that income into your calculation for the minimum that you need to withhold.
For a calculator that will show you what different #'s on a W-4 translate to in your paycheck. Check out: www.all-cpas.com/tools.html (click on tax calculators abnd then on payroll deductions)
2007-08-01 04:16:50 · answer #1 · answered by Michael K 5 · 0⤊ 1⤋
You can change your withholding every pay period.
Look at your last paystub for both of you. Do some multiplication and figure out what you'll make for the year and what will be witheld for the year at your current withholding rate.
Next go to the website for turbo tax. They'll let you fill out a tax return using those figures for the 2006 year for free (2007 will be almost exactly the same).
If you're going to owe based on the 2006 tax figures, up one of your withholdings. It doesn't matter which one of you.
Just make sure you don't underwithold significantly because that will cause you to owe a penalty.
Happy marriage.
2007-08-04 17:03:14 · answer #2 · answered by Anonymous · 0⤊ 0⤋
The withholding tables for married taxpayers are skewed to the "traditional" family with a single breadwinner. Obviously the IRS is a few decades out of sync with reality.
For married couples who both work, they should sit down together with a Form W-4 package http://www.irs.gov/pub/irs-pdf/fw4.pdf and fill out the worksheets on page 2 to figure out your withholding allowances. The number of allowances that you come up with is the total number that you should claim between you. If it comes out to 1, then one of you would claim 1 and the other would claim 0. Normally the spouse with the higher income should claim the allowances and the other should claim 0. The greater the difference in your individual incomes, the more important that it is for you to figure it out this way.
2007-08-01 04:12:26 · answer #3 · answered by Bostonian In MO 7 · 1⤊ 0⤋
You should both claim 0 and then you'll be able to get a nice rufund
2007-08-01 03:39:10 · answer #4 · answered by tfuzzy427 3 · 0⤊ 1⤋
Who ever is making the most money should claim two dependents and the other none.
2007-08-01 03:34:58 · answer #5 · answered by Don 5 · 0⤊ 2⤋
both claim married - 1 - you should get a small refund
2007-08-01 03:34:44 · answer #6 · answered by Anonymous · 0⤊ 1⤋