How to Verify W-4 Withholdings on a Paycheck

When you start a new job, the first piece of paperwork you must fill out is your W-4. Your employer uses this to withhold tax from your paycheck. However, when you have life changes, such as getting married or divorced or have a death in your family, your W-4 may need to change. Verify your W-4 withholding every year for accuracy.

Difficulty: Moderately Easy

Instructions

1. Verify your W-4 withholding if you get married or divorced. You can submit a new W-4 any time you have a change by contacting your employer's payroll department. They will provide you with a new W-4 form to fill out.

2. Check your W-4 withholding if you get a big refund. This means you let the government hold more of your money all year, interest free. Request a new form and fill it out with maximum dependents so that you get more money in every paycheck.

3. Look at your W-4 withholding if you pay a large tax bill. This means you are not allowing the government to take what is due them. Add more dependents to your W-4 form. Alternatively, request additional funds be deducted from your paycheck for tax per each pay period.

4. Determine how much tax you should pay. Read IRS Publication 505 (see resource section for link) and complete the worksheets provided.

Tips & Warnings

• Instead of paying too much tax every paycheck, change your W-4 withholding to the maximum number of dependents. Take the new pay difference and invest it. You won't miss this money since you are not used to having it, so watch it grow for you.
• Verify your W-4 withholding yearly. If you do not pay a sufficient amount of tax through the year and you need to pay an amount over $1,000, you may have to pay penalties as well.

Resources

• Verify W-4 withholding on your paycheck.