W4 for two jobs and home based business?
I have a home based business and two full time jobs. Someone told me I should claim 9 exemptions on my W4's for my jobs, because I have a business. Is this legal? If so what kind of exemptions could I claim?
i dont know whether its illegal, but why would you do that?
your business will generate more income tax owed, which you could offset with your two jobs.
doing what you have been advised will cause you to either get a smaller return or maybe owe income tax. And if you owe, this could cause you to pay a penalty for not paying estimated taxes on your business's income.
it makes sense for some people, but not for a person in your situation.
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i dont know whether its illegal, but why would you do that?
your business will generate more income tax owed, which you could offset with your two jobs.
doing what you have been advised will cause you to either get a smaller return or maybe owe income tax. And if you owe, this could cause you to pay a penalty for not paying estimated taxes on your business's income.
it makes sense for some people, but not for a person in your situation.
References :
The W4 exemptions you claim are upto you. Higher number of exemptions on your W4 just means that you get more on the paycheck and probably a lesser refund (or owe the irs) at the end of the year. The exemptions does not affect your overall taxes – just how much taxes are witheld from your paycheck by your employer.
You can also use online w4 calculators to calculate the number of exemptions
References :
http://www.qcktax.com/w4-calculator.php
If you claim 9 there probably wont be any taxes taken from your paycheck. Depending on how much you owe in taxes the end of the year you can pay penalties also. I would not claim more than 1 or 2 so taxes are taken out.
References :