Single Withholding vs. Married Withholding: An Overview
Withholding is a way of spreading out your tax burden over the course of the year. The amount that’s withheld from your pay for taxes is based on the information you provide to your employer on Form W-4 when you begin a job. Your employer uses your W-4 to calculate your withholding on payday. The Internal Revenue Service (IRS) has redesigned the W-4 form for 2020, a change necessitated by the Tax Cuts and Jobs Act's elimination of the personal exemption, so make sure that is the one you use, starting on Jan. 1, 2020.
Form W-4 allows you to claim allowances, and the more allowances you claim, the less tax is withheld from your paycheck. Married taxpayers tend to claim more allowances than single taxpayers because there are two of them, and allowances are something like a head count as to how far your pay has to stretch to support everyone.
Allowances correlate with tax brackets and standard deductions at tax time. These are more generous for married couples as well, again because it’s presumed that their expenses are greater.
- The more allowances you claim on the Form W-4 that you submit to your employer, the less tax is withheld from your pay.
- The goal is to withhold the right amount to avoid owing additional tax at tax time or overpaying so you receive a refund.
- You’re typically safe claiming just one allowance if you’re single and have only one job.
- A married couple qualifies for a greater number of allowances than a single person, one for each spouse, so withholding is less.
You’re typically safe claiming one allowance if you're single and have only one job. You’re not prohibited from claiming two, but this can be tricky. You might find that you owe the IRS money at the end of the tax year if this results in too little being withheld from your pay.
You can "split" your allowances if you have more than one job. For example, you might claim one allowance on your W-4 for each of them, but you're also entitled to claim two with one employer and zero with the other.
You can claim an allowance for your child as well, or one for each child if you have more than one, even if you’re single. Remember, the premise is that you need more take-home pay to make ends meet for your family.
You’re unfortunately limited to zero allowances if you're single and someone else claims you as a dependent on his or her tax return. As a result, the most possible taxes will be withheld from your pay. Of course, this might well result in a tax refund, because you’d be paying in more over the course of the year than your actual tax bill will amount to at year’s end. You can also elect to claim zero allowances on your W-4, even if you don’t have to. This can help you owe less in estimated taxes if, for example, you have income from a side gig or Social Security.
You cannot claim any withholding allowances on your W-4 if you are single and someone claims you as a dependent on their tax return.
A married couple qualifies for a greater number of allowances. You have two right off the bat—one each for you and your spouse. And if you have children, you can claim an allowance for each of them. Again, the more allowances you claim, the less will be withheld from your pay for taxes.
It can get tricky if only one spouse works, however. The IRS provides a withholding calculator to help you get it right.
Filling Out Your W-4 Form
Single Withholding vs. Married Withholding Example
If you’re married and have two children, you might claim four allowances—one for each of you. Assuming that each allowance is worth $1,000 annually, that works out to $4,000 less that will be withheld from your pay over the course of the tax year. You’ll receive approximately an additional $77 per paycheck if you’re paid weekly: $4,000 divided by 52.
However, if you’re single and have no dependents, you might claim just one allowance for $1,000 a year. You’ll receive an additional $19 per pay period for this allowance if you’re paid weekly, a difference of $58 a week in take-home pay than if you were married with children and claimed four allowances.
Under certain circumstances you can be granted an exemption for having tax withheld, but it expires annually, so remember to renew it.
It’s possible to have too much or too little income withheld from each paycheck depending on the number of allowances you claim. The goal is to withhold just the right amount to avoid owing additional tax at tax time or overpaying so you receive a refund.
Refunds aren't a gift from the IRS. It is simply returning your own money to you—interest free—because you paid in too much over the course of the year. The IRS obligingly holds onto that extra money for you and gives it back to you at the close of the tax year when you file your return.
Your Form W-4 is not a one-and-done deal. You can—and should—submit a new one to your employer whenever your tax situation changes, such as because you’ve married, divorced, added to your family, or to accommodate new tax laws. You can submit a new, revised W-4 at any time if you want to change your withholding.
It's possible to escape withholding entirely but only under some very specific circumstances. You must have been entitled to a refund in the previous year for all your withholding because you had no tax liability and expect the same situation in the current year. To get this exemption, you should write “exempt” in the space below line 4(c) and only complete steps one (your personal information) and five (your signature and the date). The exemption must be renewed annually, meaning you must submit a new W-4 each year by Feb. 15. You cannot claim an exemption from withholding if your income was more than $1,100 in 2019 or you have more than $350 in unearned income, such as from interest or dividends.
The Bottom Line
The exact amount of income tax due for a single or married individual should be verified either by visiting a tax professional or by using the withholding calculator on IRS.gov. Indeed, the IRS website provides many helpful tools for doing your taxes.