How do I fill out my W-4?

Question

This is my first job, and I don't really know what I'm doing on the W-4. Here is my information -

I think I will be making less than $2500 by the end of this year.
I'm only 16, so I'm a dependent. I don't have any kids... so I don't have any dependents myself.
I don't meet the requirements for any of the allowances on the Personal Allowances Worksheet.

The form says that you aren't exempt if you make over 850$ and you're a dependent, but whenever I fill out some of the withholding calculators online, they say that I'm going to be paying 0$ for federal taxes. What am I supposed to do???

Answer 1

Fill it out as single/zero allowances. If you're only going to make $2500, you won't owe anything - they most likely won't take anything out as long as your earnings are spread fairly evenly across the year. If they do withhold anything for income tax, file a return and you'll get it refunded to you.

Answer 2

1. In 2007, your (for Single Dependent) standard deduction is $5,350. If you are going to earn less than $5,350 there will not be any federal tax.
2. On form W4 it says that if you are Dependent and your income exceeds $850, you can't claim exemption from withholding.
3. Then on line 7 of form W4 it says:
I claim exemption from withholding for 2007, and I certify that I meet both of the following conditions for exemption.
*Last year I had a right to a refund of all federal income tax withheld because I had no tax liability and
*This year I expect a refund of all federal income tax withheld because I expect to have no tax liability.
If you meet both conditions, write “Exempt” here.

According to line 7, you can claim "Exempt" (only if you don't have any other income), but since you are a dependent, you can't claim exempt.
Another alternative is to claim only 1 allowance on W4. If any federal tax is withheld (chances are that no federal tax is withheld) you will get refund when you file your tax return. It is always good idea to file your return as it saves you from many unexpected problems. You will be filing 1040EZ, which is very easy to complete yourself.

Answer 3

Take one allowance and let it go at that.