With the passage of the Tax Cuts & Jobs Act (TCJA) in 2017, there has been major changes to the employee withholding – form W4.  To begin, the redesigned W4 eliminated  “allowances,” and “personal exemptions” but instead the form asks for the total household income by asking you to list both you and your spouse job, or if you have more than 1 employer to list all of your employers.

But lets complete the new W4 together with these 5 steps:

Step1: 

You must, without option, fill in PII data which includes your name, address, social security number, and filing status.

 

 

 

Step 2:

Tell us how many jobs you have or if your spouse works! Instead of listing your allowances, you simply indicate if you have more than 1 job or if your spouse works by putting a check mark in box 2(c).  this section want’s data on your highest paying job. only finish the next two steps if you have more than one job.

If you don’t want to disclose that fact, don’t check the box!

Step 3: Child Tax Credit

Part 3 helps decide if you are going to eligible for the child tax credit. the changes in the 2017 Tax Cuts and Jobs Act afforded some, but not all to quality for the child tax credit. 

for example, if you are single with an income of $200,000 or less ($400,000 if married filing jointly) will now  be eligible.  so to completed this form, the number of qualifying children under age 17 multiplied by $2,000 will go into the first box. The number of “other” dependents multiplied by $500 will go in the second box.

The sum of those two numbers will go on line 3.

Step 4: Other Adjustments

This section wants you to list other lifestyle events such as:

  • (a): Other income (not from jobs). Additional income that might not be subject to withholding, like dividends or retirement income.
  • (b): Deductions. Itemized deductions like mortgage interest and charitable contributions that will exceed your standard deduction
  • (c): Extra withholding. Any extra withholding that you would like to withhold each pay period.

Step 5: Sign the form

Place your signature on the form and you are all set!