Form W-4 and Paycheck Withholding

Form W-4 tells your employer how much federal income tax to take out of each paycheck. Get it right and you avoid both a large bill in April and an interest-free loan to the government. Get it wrong and you may owe tax and a penalty, or wait for a refund that could have been in your paycheck. This guide walks through the 2026 form and explains when and how to change it.

Step by step

Step 1: Personal information. Enter your name, address and Social Security number, and check your filing status. The status you check sets the standard deduction and tax brackets used to figure withholding. Your name must match your Social Security card.

Step 2: Multiple jobs or working spouse. If you have more than one job, or you are married filing jointly and your spouse works, the correct withholding depends on all the income. The form gives three options: use the online estimator (most accurate and the best choice if anyone has self-employment income), use the Multiple Jobs Worksheet, or, if there are only two jobs total, check the box on both W-4s. The box method cuts the standard deduction and brackets in half for each job and is most accurate when the two jobs pay about the same. Complete Steps 3 and 4(b) on only one W-4, ideally for the highest-paying job.

Step 3: Claim dependents and other credits. If your total income will be $200,000 or less ($400,000 or less if married filing jointly), multiply the number of qualifying children under 17 by $2,200 and the number of other dependents by $500, and add them. You can also include other credits you expect, such as education credits. Children must have the required Social Security number. See child tax credit and dependents.

Step 4: Other adjustments.

• 4(a) Other income that has no withholding, such as interest, dividends or retirement income. If you add it here, you may not need estimated payments for it.
• 4(b) Deductions. If you expect deductions beyond the basic standard deduction, use the Deductions Worksheet and enter the result. For 2026 the IRS says this includes itemized deductions and other deductions such as qualified tips, qualified overtime, passenger vehicle loan interest, student loan interest, IRAs and the senior deduction. See new deductions for tips, overtime, seniors and car loan interest.
• 4(c) Extra withholding per pay period, which is the simplest way to cover side income, gains or an expected balance due.

Step 5: Sign and date. The form is not valid unless you sign it.

Exempt from withholding

You may claim exemption for 2026 only if you had no federal income tax liability for 2025 and expect none for 2026. If you claim it, no income tax is withheld. You must submit a new W-4 by February 16, 2027 to continue the exemption; if you expect to owe tax for 2027, you must file a new form earlier, by December 1, 2026.

When to submit a new W-4

You can submit a new W-4 at any time. In some cases you are required to. If a change means less withholding than you need, such as a change from married filing jointly to single, or a spouse starting another job, you must give your employer a new form within 10 days. The IRS may review your withholding.

If the change is for the current year, your employer puts it in effect by the start of the first payroll period ending on or after the 30th day after you submit it. A new form for next year does not take effect until next year. Consider updating your W-4 when you marry or divorce, have a child, change jobs, get a raise or bonus, start side income, or begin claiming the new tip and overtime deductions.

The Tax Withholding Estimator

The IRS Tax Withholding Estimator uses your recent pay stubs and tax situation to tell you what to enter on the W-4 for the rest of the year. The IRS says to use it if you submit the form after the beginning of the year, work only part of the year, have changes in marital status, jobs or dependents, or receive dividends, capital gains, Social Security, bonuses or business income. It also helps if you may owe the Additional Medicare Tax or the Net Investment Income Tax. See Additional Medicare Tax.

It is now October, so a mid-year check is timely. If your year-to-date withholding is short, a larger Step 4(c) amount for the last paychecks can close the gap without making estimated payments. See estimated taxes.

Example: Hannah and Dev are married filing jointly and each earn about $90,000. Each checks the Step 2(c) box on their W-4. They have two children under 17, so on Dev's W-4 only they enter 2 x $2,200 = $4,400 in Step 3. Hannah leaves Steps 3 and 4(b) blank. That produces more accurate withholding than either leaving Step 2 blank or both claiming the credits.

Special situations

• Nonresident aliens. If you are a nonresident alien, the IRS says to see Notice 1392, Supplemental Form W-4 Instructions for Nonresident Aliens, before completing the form. See our pages for H-1B and visa holders and nonresident alien returns.
• Bonuses and commissions. Supplemental wages can be withheld at a flat 22% rate under certain circumstances, which may not match your actual rate.
• Pensions and annuities. Use Form W-4P instead.
• Self-employment. Withholding from wages can pay self-employment tax if you use the estimator. See self-employment tax.

Illinois withholding

Illinois has its own withholding form, the IL-W-4, Employee's Illinois Withholding Allowance Certificate. A federal W-4 does not change your Illinois withholding. See our Illinois guide.

How we can help

We review your pay stubs and prior return, recommend W-4 entries for each job, and set up a mid-year or year-end withholding checkup. See tax planning or contact us.

Frequently asked questions

General information only, not tax, legal or accounting advice for your situation. Rules, limits and deadlines change; confirm the current rules with the official source or a qualified professional before you act. Reading this page does not create a professional relationship with CPA Tax Payroll and Accounting Corp.