Need Less Withholding Withdrawn From Check

[Bobby]

My son had to take bankruptcy a few years back and now they are telling him he is receiving to large a refund each year. On the W4 I can't find a place to take out less, just take out more. Filing as single still has to much withheld.. Can he write a statement and tell his employer how much he wants withheld each payday?

[JG EA]

If he meets the exempt questions he can file exempt on line 7. Otherwise the only thing that can be done is to increase allowances. A single person with just one job can do 2. Also see the worksheet on W-4 and if he gets credits you can add more allowances.

[taxmom34]

who would tell you your refund check is too high? because you filed bankrupcy.

[gkaiseril]

If he meets the exempt questions he can file exempt on line 7. Otherwise the only thing that can be done is to increase allowances. A single person with just one job can do 2. Also see the worksheet on W-4 and if he gets credits you can add more allowances.

Unless your son does not expect to have any tax liability, I would avoid the 'exempt' option. It is provided for youth workers that will not have any federal tax liability. If your son does not qualify or has a tax liability he and his employer may have an issue with the IRS.

Your son can always claim more exemptions and have additional money withheld at the same time. There is a worksheet on the W-4.

I once saw a Big CPA firm recommended this to their summer interns. The result was a big tax due with penalty and interest. The HR department at the CPA firm walked away from this. No wonder they got in trouble.

[Bobby]

I ask him who told him the refund is to high and he said it was the people that were taking care of his bankruptcy. Thanks for all the suggestions.

[AJsTax]

Too many get this backwards.

My son had to take bankruptcy a few years back and now they are telling him he is receiving to large a refund each year. On the W4 I can't find a place to take out less, just take out more. Filing as single still has to much withheld.. Can he write a statement and tell his employer how much he wants withheld each payday?

I am amazed at how often we have to explain how the W-4 works. It really is not that hard.
single and 0 will hold out the most without requesting additional.
Single and 1 will hold a little less. Married and 1 or married and 2 will hold even less.
The more exemptions listed the LESS that will be held from the pay.

[BOB W]

I am amazed at how often we have to explain how the W-4 works. It really is not that hard.
single and 0 will hold out the most without requesting additional.
Single and 1 will hold a little less. Married and 1 or married and 2 will hold even less.
The more exemptions listed the LESS that will be held from the pay.

Also, the W-4 has NOTHING to do with how a t/p files his/her tax return (1040). It is only a way to control withholding based on how you want the 1040's outcome to come out.

An example is when both H and W both work. You can not use the W-4 as a stand alone form for each spouse. Going futher, it will also depend on the second spouse's level of income and how it effects a joint return. One may want to fill out a W-4 with Single 0 for each spouse on a joint tax return.

[OtisMozzetti]

I don't mean to give Bobby, the subject of the original posting, any grief. His lawful options have already been well explained to him.

What I would like to say, though, is that underwithholding by design beyond the rules for Form W-4 and estimated payments runs a high risk that some taxpayers, especially those with a recent bankruptcy who might be in financial distress, will end up with balances due which the IRS will have difficulty collecting.