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Understanding Your Withholding Allowance on Your Form W-4

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If you have filed your 2022 taxes, you may wonder what to expect and what moves you should make now. One of the most critical moves you can make is to do a check-up and make sure you have the correct amount of withholding taken out of your paycheck since you may be seeing more money in your paycheck related to lower tax rates under the new law.

TurboTax has you covered and can help you adjust your withholding allowance on your W-4 with our  W-4 Withholding Calculator, which is updated to reflect 2023 tax law changes. 

How does this impact my withholding on my paycheck?

Individual tax rates are 10%, 12%, 22%, 24%, 32%, 35%, and 37%, and these rates will be reflected in the amount of money being withheld from your 2023 paychecks. The IRS updates these individual tax rate brackets as part of annual inflation adjustments.

When you complete a Form W-4, you allow your employer to withhold the correct federal income tax from your paycheck. Generally, if too little tax is withheld, you will owe tax when you file your taxes. On the other hand, if too much is withheld, you will generally get a refund back. 

Each year, federal withholding should be close to your ultimate tax liability so you don’t owe money at tax time.

Do I need to file a new Form W-4 with my employer?

You should file a new Form W-4 with your employer if your personal or financial situation changes or if you start a new job.

Form W-4 (Employee’s Withholding Allowance Certificate) is completed and submitted to your employer so they know how much tax to withhold from your pay. Typically, you would file a new W-4 when your personal or financial situation changes. A W-4 form takes into account the number of people in your household, tax credits, deductions, and other income, and if you have more than one job or you’re a two-earner household.

TurboTax W-4 Withholding Calculator will make it easy to see how many withholding allowances you should take to boost your tax refund — or your take-home pay and also includes the W-4 form that you can fill out and give to your employer.

Don’t worry about knowing the new tax laws. When it comes time to file, TurboTax has you covered and will be up to date with the latest tax policy information. Meet with a TurboTax Full Service expert who can prepare, sign, and file your taxes so you can be 100% confident your taxes are done right. Start TurboTax Live Full Service today, in English or Spanish, and get your taxes done and off your mind.

5 responses to “Understanding Your Withholding Allowance on Your Form W-4”

  1. Have used turbo tax over ten years, and cannot get into anything. I have never had a password, and unable to get into programs. please send a phone number and address so I may correct things with your help.

  2. If my child lives at home. Andcplanscon enrolling in college. But isn’t working the whole year. Can I claim him? And will I receive a refund for him?

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