Avoid an unexpected tax bill by following these steps to see if you should adjust your W-4 allowances:
Step 1. Use H&R Block's
Making Work Pay Calculator to see how the changes in the 2009 economic stimulus plan changed the total amount of dollars in your paycheck.
Step 2. If the total amount shown in the blue box at the bottom of the calculator is more than $400 if you are single or more than $800 if you are married filing jointly, then you may want to adjust your W-4 allowances so you don't have a reduced refund or increased balance due at tax time.
Step 3. Use H&R Block's
Withholding Calculator to determine the number of allowances and additional withholdings that you may need to claim on your W-4 in order to prevent an increased balance due at tax time.
Note: If you have more than one W-2, please use the IRS Withholding Calculator.
Use the IRS calculator.
Step 4. The Making Work Pay tax credit is pretty complex. If you would like a professional at H&R Block to help you understand how you will be affected and what can be done, please stop in at a year-round office near you for a free consultation.
The tax checkup and information provided are estimates, and your actual tax liability may materially differ depending on recent and future changes to the tax law and changes in your personal and financial circumstances. If your personal and financial circumstances do change, we suggest that you review the changes with your tax advisor.
