Can you claim more allowances when you fill out your W4 Withholding paperwork than you do on April 15th? The answer is yes. Can that result in an increase in the money you get back during the year? Again the answer is yes. Can it result in you owing money at the end of the tax year? Absolutely yes, if you aren’t careful enough.
Here’s a link for the current W4 that is on file on the IRS website: W-4 Withholding Allowance
Now you can and probably should read the entire form since it is only 2 pages long. But I’ll fill mine out like I did when I handed it to my employer.
As you can see, we can legally claim at least 13 on my W-4. Possibly more, but I’d rather err on the side of caution so that I don’t owe money at the end of the year.
Can this work out to be a lot, well yes. Let’s say you get back $4,000 at the end of the tax year. Using the W-4 you can adjust it over a few months to get about $2,400 of that money throughout the year, or $200/month.
Does this approach work for everyone? Not really and it isn’t designed to. It is to show proof that you can claim more on your W-4 than you actually have or will claim around April 15th of the following year and not break any rules.