2007-08-10 09:51:13 · 4 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
it means that your employer will not withhold federal withholding tax, and if you did the same thing on your state version of the W-4, they won't withhold any state tax either. They still have to withhold social security tax, 6.2%, and medicare tax, 1.45% though. I have also included a link to a paycheck calculator site, just in case you want to find out whether you can claim exempt.
PS, Suzy is incorrect, even claiming "exempt" on your W-4, you still have to pay the social security and medicare taxes, a W-4 can't exempt you from those.
2007-08-10 09:57:15 · answer #1 · answered by Anonymous · 0⤊ 0⤋
It's explained (sort of) on the form. You can only fill it out as "exempt" if you had no tax liability the previous year, and don't expect to have any this year.
If you fill out the form as "exempt" they won't withhold anything for income taxes. But then if you end up owing any, you'll not only have to pay them when you file your return, but can also be fined $500 for claiming exempt when you aren't.
Filing exempt doesn't change anything on what taxes you pay, just how much they withhold from your paycheck.
2007-08-10 09:59:25 · answer #2 · answered by Judy 7 · 1⤊ 0⤋
My husband entered here illegally when he was 16 and just recently went back to mexico filed the appropriate paper work and hes home now as a Legal Permanent Resident!! Now he did pay taxes before because he had a ITIN number. With this number even if you are getting paid cash you can still file taxes as he did. Its a legal number issued by the IRS. Its a simple application and you can get it. Thank God hes legal now though. We have been married 8 years and together for 11. He faced the consequences and went back and made it right what he had done!!! Just thought Id throw that in there :)
2016-05-19 01:23:50 · answer #3 · answered by hermine 3 · 0⤊ 0⤋
If you are exempt, you don't pay taxes.
2007-08-10 09:56:28 · answer #4 · answered by Suzy 5 · 0⤊ 4⤋