W-4 - What is the Correct Amount of Tax Withholding?

Form W-4 allows you a degree of control over how much of your income you want to subject to those federal taxes by controlling the amount of withholding allowances you can claim on your paycheck. Without a W-4 on file, an employer is required to withhold at the highest rate - as if you are single and claim zero allowances. The more allowances you claim, the less your employer will tax from your paycheck. The number of exemptions you should claim varies and is based on a number of factors, such as marital status, job status, earned wages, filing status and child or dependent care expenses. 
If you are exempt on your W-4, that means you are telling your employer that you do not want any money withheld from your paycheck for federal taxes. You must meet the following two criteria to file as exempt:

1. You were refunded all of your withholding in the previous year because you had no tax liability;
2. You expect to have no tax liability in the current year.

Remember, if another person can claim you as dependent on his or her tax return, you cannot claim exemption from withholding if your income exceeds $1,050 and includes more than $350 of unearned income.
W-4 includes three worksheets to help you determine the correct number of allowances.
 
You can use the withholding calculator to help you figure out how many extra allowances you should be claiming on your W-4.  Withholding Calculator

You can adjust your withholding at any time during your employment.

The Form W-4 and instructions for 2016 can be downloaded here:  Form W-4 (2016)

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