2020 withholding calculator

[Catica]

Hi

I'm trying to fill out the new W-2 form so they are not taking out too much taxes each paycheck, as according to the IRS withholding calculator I will get a refund, which I don't want.  So I use the slider to adjust my refund to $0 and it spits out info how I should change my W-2 form.  What I don't understand is why it is telling me to "Enter $16 in additional withholding per pay period".  I want to reduce how much they are taking out, so why is it telling me to adjust my W-2 to withhold more money?  What am I missing?

[MDM]

So I use the slider to adjust my refund to $0 and it spits out info how I should change my W-2 form.  What I don't understand is why it is telling me to "Enter $16 in additional withholding per pay period".

One possibility: you told the calculator that you will have income other than your salary.  The $16/pay is to cover the tax on that other income.

[Catica]

So I use the slider to adjust my refund to $0 and it spits out info how I should change my W-2 form.  What I don't understand is why it is telling me to "Enter $16 in additional withholding per pay period".

One possibility: you told the calculator that you will have income other than your salary.  The $16/pay is to cover the tax on that other income.

The calculator asks how many jobs I will have and how many the spouse will have, I put 1 for each. So I guess it takes my spouses income into account.  OK, thanks.

[Nothlit]

It is telling you that your current withholding settings (from your last/old W-4) will result in you getting a refund. The additional withholding it's telling you is relative to the new W-4.

In other words, new W-4 with some additional withholding may still result in less total withholding than your old W-4 with no additional withholding.

[Catica]

It is telling you that your current withholding settings (from your last/old W-4) will result in you getting a refund. The additional withholding it's telling you is relative to the new W-4.

In other words, new W-4 with some additional withholding may still result in less total withholding than your old W-4 with no additional withholding.

Not sure I follow. Why would the calculator assume that the refund is based on old W-4? I'm using new W-4 since the beginning of the year, which causes a lot of $$ taken out of my paycheck, hence I'm trying to adjust it. 

[EliteZags]

I have the same question, how do you go about reducing witholding

[Catica]

I have the same question, how do you go about reducing witholding

The instructions say that you can reduce withholding by putting some $$ amount for credits and other reductions (Line 3 on Form W-4 ).  I put $500 and it made a very little difference, then changed it to $800 still with little difference, so I'm not sure what else one can do.

[EliteZags]

calculator told me to put $2600 to mitigate a potential ~$4K refund

[MDM]

I have the same question, how do you go about reducing witholding

Step 3 of https://www.irs.gov/pub/irs-pdf/fw4.pdf.  One can ignore the two "multiply" lines and put whatever one wishes on the "...enter the total here" line.

See also Calculations!F57:I72 in the case study spreadsheet as a double check to the IRS calculator if interested.

[EliteZags]

so where the tax withholding calculator says "Enter $xx for credits and other reductions to annual withholding"



that's actually in Step 3 (Claim Dependents) on the W4? why wouldn't they just say that, calling it "credits and other reductions to annual withholding" seems like it could go somewhere in Step 4(b) but there's no line that's made obvious there where it goes either

[MDM]

so where the tax withholding calculator says "Enter $xx for credits and other reductions to annual withholding" that's actually in Step 3 (Claim Dependents) on the W4?

Yes.

why wouldn't they just say that, calling it "credits and other reductions to annual withholding" seems like it could go somewhere in Step 4(b) but there's no line that's made obvious there where it goes either

Don't know, but 4a and 4b are additions to and subtractions from income, while 4c is an increase to withholding.