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• Reputation: 1812 Q&A: 22 0 42 1409 992 23 Classifieds: 0 0 what's this? Follow Following 3

  1 0 An increase in the number of excemptions from witholding leaves more money in your paycheck... but it also means less money is being held back to over your taxes when it comes time to pay them. A decrease in the number of exemptions means the govt will hang onto more money so that that pool will be available to offset your taxbill when you file. At least, that's how I understand it. O my captain answered in Taxes about 1 year ago | Report Comment on this answer Enter your comment or ask a new question preview THIS IS A PREVIEW: Click "Post" to submit it or "Edit" to make changes. edit Please wait… This could take a minute if the tubes are clogged.

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• Reputation: 976 Q&A: 26 0 7 567 256 1 Classifieds: 0 0 what's this? Follow Following 0

  0 0 I've been claiming 2 on salary for years and always break even or owe a tiny bit (<$100) each tax season. I'm firmly in the "screw giving the IRS an interest free loan by overpaying" camp. You know withholdings are totally optional as long as you don't have a history of tax problems. If you really want, you can ask your employer to not withhold anything and do your own taxes at the end of the year. If you take this seriously, be prepared to write a check for 15-20% or so of your total yearly income before April! If you don't, you will owe more than you can pay, get penalties, be put on a payment plan with the IRS that could turn into a garnish of your paycheck in a worse case scenario, and you'll probably have paycheck withholdings forced onto you for being bad at taxes. protosaurus answered in Taxes about 1 year ago | Report 1 comment by keshmeshi… 0 0 It's my understanding that, if you don't withhold or file your taxes quarterly, you may have to pay interest to the IRS for that year of not paying taxes. I have some friends who are freelancers, and it's an issue for them. keshmeshi commented about 1 year ago | Report Enter your comment or ask a new question preview THIS IS A PREVIEW: Click "Post" to submit it or "Edit" to make changes. edit Please wait… This could take a minute if the tubes are clogged.

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  0 0 OMC is right. Increasing exemptions increases your take home pay by decreasing the amount that is withheld to offset your tax bill. Typically you take 1 exemption for yourself. +1 if you have a spouse filing jointly. +1 (or more) if you have a mortgage. etc. based on any other tax deductible items you will have. If you have been getting big refunds in the past then your exemptions should be higher than they were before. If your refunds have been minimal then you has the correct exemptions and should leave it as it was. The worksheets tend to err on the side of getting you to over withhold in my experience. infernactual answered in Taxes about 1 year ago | Report Comment on this answer Enter your comment or ask a new question preview THIS IS A PREVIEW: Click "Post" to submit it or "Edit" to make changes. edit Please wait… This could take a minute if the tubes are clogged.

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