New kid, new job, wife quitting her job, W4?

[jeromedawg]

Hey guys,

I didn't even think about changing my W4 until now for whatever reason but I'm a bit confused as to what I should do with all the recent life event changes. Previously I was claiming 0 allowances, and this probably should have changed back when we had our kid in August. Did I lose anything by not doing this?

Other changes:
- December 30th I left my old job and started with the new company on Dec 31st (2015)
- Today (1/29/16) is my wife's last day at her job.


Given all this, what would an appropriate number of allowances be to claim? 5?

[redcedar]

Did you lose anything? Some extra money paid in taxes each month which you would see in your upcoming tax refund. Its is something that you do want to change but its not life changing money.

Start with the actual W-4 form and worksheet - https://www.irs.gov/pub/irs-pdf/fw4.pdf

It is not very intuitive, at least not to me, and you may take some time working through it but at least you will know where the government wants you to fall and what your max allowances will be. Another option is this version that is more of a Q&A format - https://apps.irs.gov/app/withholdingcalculator/index2.jsp

Also, don't forget your state version if you pay state income taxes.

[jeromedawg]

Did you lose anything? Some extra money paid in taxes each month which you would see in your upcoming tax refund. Its is something that you do want to change but its not life changing money.

Start with the actual W-4 form and worksheet - https://www.irs.gov/pub/irs-pdf/fw4.pdf

It is not very intuitive, at least not to me, and you may take some time working through it but at least you will know where the government wants you to fall and what your max allowances will be. Another option is this version that is more of a Q&A format - https://apps.irs.gov/app/withholdingcalculator/index2.jsp

Also, don't forget your state version if you pay state income taxes.

Thanks, I just ran through the calculator and it's such a PITA. For some of the fields I just guessed since I don't have the information readily on-hand. It ended up advising me to claim 6 allowances. Guess I'll wait till my wife gets home to go through it more thoroughly.

As far as current taxes for 2015, we left our W4s at claiming 0 allowances last year and currently looks like we owe around $2400 for Fed with a $1200 CA state refund. I did have some capital gains/losses so that may have affected the amounts. Historically, we have ended up owing a little more than this. Is it *normal* to owe if we both had claimed 0 allowances?

[MDM]

...just ran through the calculator and it's such a PITA. For some of the fields I just guessed....

Does the acronym GIGO ring a bell?

As far as current taxes for 2015, we left our W4s at claiming 0 allowances last year and currently looks like we owe around $2400 for Fed with a $1200 CA state refund. I did have some capital gains/losses so that may have affected the amounts. Historically, we have ended up owing a little more than this. Is it *normal* to owe if we both had claimed 0 allowances?

Without specifying non-W2 gains and losses, there is no "normal".  See http://forum.mrmoneymustache.com/taxes/best-way-to-calculate-w-4-exemptions-for-2016/ for a similar discussion.

[jeromedawg]

...just ran through the calculator and it's such a PITA. For some of the fields I just guessed....

Does the acronym GIGO ring a bell?

As far as current taxes for 2015, we left our W4s at claiming 0 allowances last year and currently looks like we owe around $2400 for Fed with a $1200 CA state refund. I did have some capital gains/losses so that may have affected the amounts. Historically, we have ended up owing a little more than this. Is it *normal* to owe if we both had claimed 0 allowances?

Without specifying non-W2 gains and losses, there is no "normal".  See http://forum.mrmoneymustache.com/taxes/best-way-to-calculate-w-4-exemptions-for-2016/ for a similar discussion.

Yea, playing around with it more I altered a few more things that I got more details on and the recommended allowances went to 1 lol...