wrenbaker
Team Owner
Thanks, I know now for next year. I even did the tax estimator on the IRS website before I changed it. The personal allowances were eliminated on this new form. I read that the updated w-4 was implemented so that there is less $ being refunded during tax season.You can elect to have an additonal, specific amount withheld from each paycheck above the W-4 withholding. I just did this so that I end up paying more throughout the year.
“The new W-4 form was intended to minimize refunds and have withholdings more accurately reflect people's ultimate tax liabilities. In other words, many taxpayers took home slightly bigger paychecks last year at the expense of refunds this spring.”
https://www.cnbc.com/2021/01/29/don...t-april-tax-season-may-be-a-big-surprise.html
“Allowances are no longer used for the redesigned Form W-4. This change is meant to increase transparency, simplicity, and accuracy of the form. In the past, the value of a withholding allowance was tied to the amount of the personal exemption. Due to changes in law, currently you cannot claim personal exemptions or dependency exemptions.”
FAQs on the 2020 Form W-4 | Internal Revenue Service