Check out some similar questions!

mej7989 · Dec 12, 2007, 02:10 PM

I need to know how much to claim on my W4 so I can pay my full tax bill and break even at the end of the year.

AtlantaTaxExpert · Dec 12, 2007, 03:25 PM

THAT is a moving target.

The average single guy who claims ONE exemption on his W-4 should come reasonably close.

However, if you have a family and your spouse works, adjusting the amount withheld to break even is a matter of trial-and-error.

This is due to changing circumstances and a variety of credits and deductions that are NEVER exactly the same from year to year.

MukatA · Dec 15, 2007, 06:40 AM

For 1040 filers 1 or 2; for 1040NR filers 0 or 1.

ScottGem · Dec 15, 2007, 08:06 AM

Each dependent is one deduction. If you own your home and pay mortgage, then that can be another 2 (for the interest and property taxes). If you have a lot more deductions (tuition maybe) you might get another.

But as ATE said, it's a moving target. No way you will break even exactly. I've managed to fluctuate between $100 + or - the last several years.

s_cianci · Dec 15, 2007, 09:47 AM

What exactly do you want to accomplish? Do you want your withholdings to exactly equal your tax bill so that when you file you owe no tax nor receive a refund? If that's the case then look at how it's panned out for you in the past. When you file your tax returns do you typically owe or do you typically receive a refund? If you're always owing then you need to have more withheld from your wages. If you've been receiving refunds (but don't want that) then you need to have less withheld. Look over your past tax returns and note how much you've overpaid or underpaid. Then divide that amount by how often you get paid (weekly, bi-monthly, etc.) That's the additional amount that you need to have withheld from or kept in your pay. Notify the payroll manager at your employment accordingly. (S)he can advise you on how to revise your W-4 to reflect the necessary changes. As the others have suggested it's highly unlikely that you'll ever come out right on the nose but you can make it close.

AtlantaTaxExpert · Dec 16, 2007, 10:59 AM

From a purely money management point of view, your goal should be to write a $1,000 check to attach to your tax return to settle your tax bill, and to mail that return on 15 April of the following year.

ANY refund is an interest-free loan to the U.S. government, and you should not give the IRS the use of your money for free.