My employer withholds taxes as if I were single but on my W-2 form I marked I have 2 dependents?

Question

When I asked my employer if she was I was getting paid as if I were single with out dependents she said well do you have someone who does your taxes? I did not understand why she asked and said yes. Then she said thats where I claim my dependents. I do not think she understands that the more dependents the less money I will get withheld. I am in a small dental office that is new and just opening. The doctor pays with her own checks but on a sheet of paper marks the percentage of all my deductions. It is her first time being an employer, her first time opening and running her own business.

My question is how I explain to her that I want to get paid as if I had two dependents. I have two children. I get so much taxes taken off I need to either get another job or replace that one.

Answer 1

There seems to be a disconnect in communication here. You don't claim "dependents" on Form W-4 (not W-2) but claim "witholding allowances." It sounds as if your employer is using a strict interpretation of things as you claim dependents on a tax return.

You can download a new Form W-4 from the IRS website here: http://www.irs.gov/pub/irs-pdf/fw4.pdf Fill it out and hand it to your employer. Ask her to make sure that taxes are withheld in accordance with what you have put on the Form W-4.

If she still does not understand what is going on she should consult with her tax advisor to make sure that she is doing payroll properly. Alternatively there are payroll services either on line or at brick-and-mortar firms that can handle this for her for a fee. She may balk at paying extra just to cut one check but if you point out to her that it will free up time for patient care it may be worthwhile financially as well as ensuring that things are done properly.

Answer 2

If you under withhold, you will owe a penalty. I would suggest to stay at a 1 and enjoy the lump sum check at the end of the year. Its not like any savings account will pay enough interest right now to offset you getting an extra 30-40 bucks a month. A 0 on your W-4 will get your the lowest amount withheld, but you have to be very careful about the penalties that could be charged with you file your return if you don't pay enough in. The form that you fill out that derives the 1 above the W-4 is in use for a reason, so you have the correct amount withheld. Most single people won't have a large refund anyhow, unless you can itemize which usually includes owning a home for most people. www.irs.gov will have anything you need when it comes to IRS forms.

Answer 3

Go to www.irs.gov and get a W-4. Fill it out and hand it to her.
Each time you give a W-4 to your employer, they are to use the numbers on it going forward from that date (if too much has already been withheld, you will get that back when you file your taxes).

For example if you were paid $1000 every two weeks, the difference between 1 allowance and 3 allowances would be about $40 less in taxes being withheld.

Answer 4

I'm no expert on taxes, but I know what that doctor told you is wrong. The whole point of the W-2 form is to tell the employer how much you want withheld. Your employer really needs to hire a payroll firm to handle that part of the business and get it right.

Employers mess up employee's withholdings, or blatantly disregard the instructions, all the time. For example I've repeatedly requested my wife's employer to add a specified amount to the withholdings out of each paycheck, and year after year they fail to do it.

If this is really important to you, and you're not particularly attached to this job, you might want to consider working somewhere else. Since this is your employer's first business, I'd bet good money this will not be the only place where she makes mistakes. Honest mistakes yes, but you still have to deal with the consequences.

Answer 5

Tell her to look at IRS Publication 15 - that has the info on how she is required to deduct taxes. Or downloan it yourself, print it, and give it to her. You are `correct, she has to deduct an amount that follows your W-4 instructions.

When you file your tax return, you will claim your two children, and that will reduce the total tax that you owe for the year. If she took out too much, you'll get the extra back then as a refund, so you won't really lose it, you'll just get it later.

You probably can't do anything about what's already been taken out except wait for it in your refund - that's already been sent on to the IRS.

Answer 6

She's not understanding your issue - you want to change your withholding. Yes, it is true that you 'true' this stuff up when you do your taxes, but in the meantime, it impacts your cashflow. Tell her you want to file a new W-4. This is a form that sets out how much tax is withheld from each paycheck. You fill it out; your employer files it for you.

Answer 7

You will get most of your withheld taxes back when you file. Many do their taxes this way. You might want to see if your employer has an accountant as well.

Answer 8

You get back the extra withheld money when you file your return (or pay less tax that you would otherwise owe then). It's a net wash.

Answer 9

Find a copy of the legal state tax laws and show her.
Find an accountant savvy tax person and ask them to explain to the boss.
And tell the boss for the next tax year that you do not have anyone that does your taxes.

Answer 10

Complete a new W4 form (Line 5) with your payroll clerk.