Tax Tip of the Week
900 N. Kings Highway, Cherry Hill, New Jersey 08034
856.667.4100 ·
215.563.0276 ·
Fax: 856.667.3652
For the week of
May 29, 2000
Know when to change withholding on wages by using Form W-4
You may want to change your Form W-4 to increase or decrease
the amount withheld from your wages. If you had a large refund last year, you may want to reduce the excess pay-in.
On the other hand, if you had a balance due (this is usually unexpected and a little painful), you may need to
increase your withholding to avoid the problem next year. In some cases, taxpayers are required to change their
W-4s even if they don't want to.
The withholding form has three basic types of information: (1) marital status, (2) number of allowances (dependents),
and (3) additional amount the employee wants to have withheld. An employee can change his or her W-4 at any time
during the year.
You are required to file a new W-4 with your employer under certain circumstances:
- You claimed married status and are now divorced, or your
spouse is now claiming an allowance on a separate W-4.
- You claimed a dependent that you can no longer take on your
tax return.
- You claimed an allowance for a child whose income, age, or student status is changing, and the child can no longer be claimed as your dependent.
Any unauthorized changes to the Form W-4 will make it invalid. This includes taking out any language by which the
employee certifies that the form is correct. An employee who files a false Form W-4 may be subject to a $500 penalty.
If your employer gets an invalid W-4, he or she is required to withhold as though you were a single person claiming
no allowances.
Your employer normally holds the W-4 forms in the office files, but there are certain W-4 forms that are required
to be sent to the IRS. The IRS wants copies of all forms that claim more than ten withholding allowances or those
claiming an exemption from withholding and the employee's income would normally exceed $200 per week.
We are ready to assist employees as well as
employers with payroll withholding questions. Please give us a call.
Click here to view previous tax tips.
"Tax Tips" are published weekly to
provide useful tax information. Return to this site every week for helpful tax-cutting suggestions, tax reminders,
and current tax information.
The information contained in this site is of a general nature and should not be acted upon in your specific situation
without further details and/or professional assistance.
If you would like more information on anything in "Tax Tips," or if you'd like to be on our mailing list
to receive other tax-cutting information from time to time, please contact our office. We're here to help.
